Budget: Stakeholders commend Tinubu on oil price benchmark
Some stakeholders in the oil and gas industry have commended President Bola Tinubu for pegging crude oil price at $77.96 and the naira at N750/$1.
They gave the commendations in separate interviews with journalists on Thursday in Lagos.
Recall that on Nov. 29 Tinubu presented the 2024 ‘Budget of Renewed Hope,’ pegged oil price at $77.96 and the naira at N750/$1.
Research Fellow – Science & Technology Educational Research Group (STERG), Faculty of Education, Lagos State University, Dr Olukayode Akinrolabu, said that the supplementary budget of N27.5 trillion is a step in the right direction.
Akinrolabu said that the attendant projection for increase in GDP, employment and macro-economic appreciation were all fascinating indices for appraising and adjudging President Tinubu’s policy on oil production level and international market price.
According to him, these new rates are slightly higher than the previous $75 per barrel and 1.69 million barrels per day for 2023.
“The increase or appreciation rate is approximately 5.25 percent.
“The slight raise projection might not be far from the ongoing crusade against oil theft and the exploit of appreciable success in that drive,” he said.
Akinrolabu, however, believed that intensifying the ongoing crusade against oil theft would further culminate in appreciable gain in oil production and price, subsequently.
Akinrolabu said that the supplementary budget should have in its content component fortifying capabilities to strengthen the fiscal policy.
“That’s the way to go. It is a pragmatic compendium of decision in the whole gamut.
“A whole lot was factored into the projection, I suppose. An expository analysis will suffice in this regard.
“The carrying capacity cum production capacity of the refineries are strong indications to back up this projection,” he added.
Mr Henry Adigun, an oil and expert, said that the $77.96 crude oil price benchmark was reasonable
Adigun said, “What I am not sure about is projected outputs, that might be unrealistic and unattainable.
“And the exchange rate, I am not very optimistic about that.
“The inflow to make that happen only exists within a loan should not be a basis for setting a target for the exchange rate,” he said.
Adigun said that looking at the oil price trends the benchmark is realistic.
He added that there is a formula for its determination, saying, “You use three years’ average of the preceding year to determine that. So, that is okay.
“On the output, I am not certain how that will be achieved,” he explained.
Also, Mr Olumide Ogunmade, former Chairman, South West Zone, Independent Petroleum Marketers Association of Nigeria (IPMAN), commended Tinubu on the maiden budget presentation.
Ogunmade said that given the continuous Ukraine/Russia war and the Middle East tensions makes the $77.96 benchmark figure reliasable.
He added that given the restive Niger-Delta, the figure could be achieved and even increased to two million barrels per day before the end of 2024.
The marketer said the dollar exchange rate of N750 would not be difficult to achieve given the reforms presently embarked upon by the Central Bank of Nigeria (CBN).
“It is as a benchmark given the tension around the middle east cum the Ukraine/Russia which is not likely to abate throughout the 2024 year.”
