President Muhammadu Buhari Monday set up a special committee to assess the impacts if coronavirus on the price of crude oil with a view to reviewing the benchmark of the 2020 budget.
Minister of Finance, Budget and National Planning, Mrs Zainab Ahmed, disclosed this to State House correspondents after a meeting with President Muhammadu Buhari.
She said the committee is expected to submit its report to the President latest on Wednesday, March 11, 2020.
“We just met with the President to discuss on the impact of the coronavirus on our economy. The President has formed us into a committee, with the Minister of State for Petroleum Resources, the Central Bank Governor, the Group Managing Director (GMD) Nigeria National Petroleum Corporation NNPC as members. I am to serve as the Chairman of the committee
“Our mandate is to make a very quick assessment of the impact of this coronavirus on the economy especially as it affects the crude oil price.
“We will be writing a report and present to the President tomorrow or Wednesday morning and after that we will also have more substantial information for the press,” she said.
The minister said in view of the situation, Nigeria would have to lower its oil price benchmark, but the committee would advice government on the modalities for that.
“It is very clear that we will have to revisit the crude oil benchmark price that we have of $57 per barrel and lower the price.
“Where it will be lowered to is the subject of the work of this committee and what the impact will be on that is that there will be reduced revenues to the budget and it will mean cutting the size of the budget.
“The quantum of the cut is what we are supposed to assess as a committee. So, this is just an initial update to inform you on the directive that we have and subsequently we will be briefing the Press on the actions that will be taken,” she said.
Also speaking, Minister of State for Petroleum Resources, Mr Temipre Sylva, said in the coming days, when all oil producing nations begin to see the effect of the reduction of oil prices, OPEC might meet again and reconsider its position on cutting production.
On the issue of engaging Russia, Sylva said: “We as a member of OPEC are not in a position to take that engagement on our own unilaterally.
“There was a disagreement between OPEC and OPEC+, it’s not just Russia, but the biggest producers within OPEC and OPEC+ are Saudi Arabia and Russia.
“We believe that in the coming days when all of us would have begun to see effect of the reduction of prices, OPEC and OPEC+ might need to meet again and reconsider our positions.
“Meanwhile, we expect also that a lot of discussions are going on at the level of Saudi Arabia and Russia, but as Nigeria, we are not in a position to begin to engage members on this matter.”
