A Review of the Nigerian Energy Industry

House special committee to meet with Okonjo-Iweala over oil benchmark

Dr. Ngozi Okonjo-Iweala
Dr. Ngozi Okonjo-Iweala

Oscarline Onwuemenyi

20 February 2015, Sweetcrude, Abuja – The House of Representatives has resolved to meet with the Minister of Finance and Coordinating Minister of the Economy, Dr Ngozi Okonjo-Iweala, over the falling crude oil price at the international market.

At the House’s plenary on Wednesday, a special committee was constituted to represent the lawmakers at the meeting.

The challenges surrounding the sliding oil price are some of the primary reasons the 2015 budget of the Federal Government is yet to be passed by the National Assembly.

To discuss the issue, the House went into a closed executive session, lasting three hours.

After the closed door meeting, the House decided to set up a meeting with the Minister of Finance and the Budget Office to iron out grey areas on the budget towards a speedy passage.

The House inaugurated a 16-man special committee headed by its Appropriation Committee Chairman, Hon. John Enoh, to meet with Dr. Ngozi Okonjo-Iweala, over the crashing oil price at the international market and to further sort out out the details of the 2015 budget.

The Federal Government has severally tinkered with crude oil benchmark as prices of crude oil prices have overshot various scenarios built by the government. Crude oil prices which were above $100 about seven months ago, have decelerated by more than half that price.

It went as low as $49 per barrel, though hope of rebound came this week as prices have nudged up to $63.

Nigeria’s economy is anchored on earnings from crude oil sales, and the recent development have spawn serious gyration in the fortunes of the economy.

No time frame was given for the completion of the committee’s work.

Okonjo-Iweala had on December 17 presented a slashed estimate of N4.357 trillion from the earlier proposed N4.661 trillion in the Medium Term Expenditure Framework (MTEF), when the oil price was pegged at $73 per barrel.

A revised MTEF was however sent to the lawmakers a day before the presentation of the budget, which pegged the oil price at $65 per barrel.

Presently, the international crude price stands a little above $ 60 per barrel, representing a difference of $5 in the pegged oil price as contained in the MTEF. The 2015 to 2017 MTEF was not passed by the lawmakers before they received the budget proposal against the traditional passage of the benchmark well before the presentation of annual budgets.

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