Lagos — Nigerian Senate on Tuesday increased the oil benchmark in the country’s 2020 national budget by $3 upon seeing that International Brent had hit $38 per barrel on Monday.
The upper chamber made an increase in the oil price benchmark to $28 on hope that Brent would reach $40 per barrel soon.
The executive had earlier proposed $25 per barrel in the revised Medium Term Expenditure Framework, MTEF, and Fiscal Strategy Paper, FSP forwarded to the Senate for approval.
Earlier forecasts by analysts say Brent would hit $40 per barrel by year-end, however, SweetcrudeReports forecast https://sweetcrudereports.com/oil-could-hit-40-in-june-ahead-of-forecasts/ sees Brent hitting $40 this month.
True to our forecast, Brent hit $39.35 per barrel at about 10.40 am Nigerian time on Wednesday.
The Senate’s resolution was sequel to the consideration and adoption of report of its Committee on Finance mandated to work on the revised MTEF/FSP documents by the executive during plenary.
The Chairman of the Committee, Sen. Solomon Olamilekan, presented the report.
The senate also reduced from 1.9 million barrel per day to 1.8 million barrel per day oil production proposed by the executive in the MTEF/FSP documents.
Brent surged as the Organization of Petroleum Exporting Countries, OPEC and its partners move closer to a compromise on extending current oil output cuts and are discussing a proposal to roll over supply curbs for one to two months.
OPEC+ agreed to cut production by 9.7 million barrels per day, or about 10 percent of global output, to lift prices affected by low demand due to lockdown measures at stopping the spread of the COVID19.
The group is likely to hold an online meeting on June 4, one week ahead of its usual meeting date from June 9-10.