2018 Budget:Experts urge FG to review oil benchmark

Experts have sought a review of the 2018 budget benchmark, following the rise in crude oil price in the international market.

Last week, the product  hit $69 per barrel. The Federal Government’s $22 benchmark has been increased to $47 per barrel by the Senate.

An economist, Mr. Yinka Ogunjimi, argued that the going rate of the commodity would remain so for a greater part of the year, hence, the need for government to jerk up its benchmark in the budget. Doing so, he argued, would take off a huge burden of deficit from the financing of the budget, and give some breather to the economy to service its debts.

“It will also allow more funding opportunities for major projects in the fiscal year. Although the Federal Government was very con-servative with its bench-mark, jerking the benchmark up to $53 per barrel, I believe, is still within reason range. This is because from all variables, crude oil is not likely to sell below $60 per barrel for  most part of the year,” Ogunjimi further argued.

A Professor of Financial Economics, Leo Ukpong, also agreed that the $45 per barrel was conservative.

Ukpong, who is Dean, Faculty of Business Admi-nistration, University of Uyo, Akwa Ibom State, said, was because the commodity is likely to sell at a higher price in  the year, considering the uncertainties in oil producing regions, which he noted include include the political quagmire in places, such as Venezuela and Qatar; economic sanctions on Iran; fightings in Iraq, Libya, and Turkey, which are likely to lead to a drop in global oil supply.

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