Indication that this trend will persist this year emerged
yesterday when the price of crude oil, rose to $63.02 per
barrel from $60 per barrel, representing $3 above the
nation’s budget benchmark of $60 per barrel.
According to the economic report for the fourth quarter of
2018 ( Q4’18) released by the Central Bank of Nigeria
(CBN) yesterday, total oil revenue rose by 129 percent to
N9.4 trillion in 2018 from N4.1 trillion in 2017. Non oil
revenue also rose by 21 percent to N3.9 trillion from N3.2
trillion in 2017. Consequently oil revenue accounted for
71 percent of the total federally collected revenue which
rose by 82 percent to N13.3 trillion in 2018 from N7.3
trillion in 2017.
However, total federally collected revenue fell by 4.8
percent to N2.4 trillion in Q4’18 due to decline in non oil
revenue.
The report said: “At N2.41 trillion, federally-collected
revenue in the fourth quarter of 2018, was lower than the
proportionate quarterly budget estimate of N3.32 trillion
billion by 27.4 per cent. It also, fell below the receipts in
the preceding quarter by 4.8 per cent.
“The decline in federally-collected revenue (gross) relative
to the proportionate quarterly budget estimate was
attributed to the shortfall in receipts from both oil and
non-oil revenue components during the review period
Gross oil receipt, at N1.46 trillion or 60.7 per cent of the
total revenue, was below the proportionate quarterly
budget estimate by 23.7 per cent, but higher than
receipts in the third quarter of 2018 by 5.1 per cent.
Despite the increase in crude oil price, oil revenue
declined relative to the proportionate budget owing to
shortfalls in crude oil production and exports, arising
from maintenance at various NNPC terminals.
“Non-oil revenue, at N946.90 billion or 67.6 per cent of
the total, was below the proportionate quarterly budget
estimate of N1.4 trillion and the level in the preceding
quarter by 32.4 per cent and 17.0 per cent, respectively.
The lower non-oil revenue relative to the proportionate
quarterly budget estimate was due to the shortfalls in
receipts from Federal Government Independent Revenue
and VAT in the review period”.
FG records N3.4 trillion deficits in 2018
Meanwhile the federal government recorded N3.4 trillion
deficits in 2018, representing 59 percent when compared
with the deficit of N2.14 trillion recorded in 2017.
The CBN Q4’18 economic report also revealed that deficit
rose to N910 billion during the quarter, representing …
percent from N855.09 percent recorded in Q3’18.
The CBN said: “Federal Government retained revenue for
the fourth quarter of 2018 was estimated at N916.44
billion. This was below the proportionate quarterly budget
estimate and the receipts in the preceding quarter by 51.5
per cent and 11.5 per cent, respectively. Of the total
revenue, Federation Account accounted for 90.4 per cent,
while VAT, Excess crude/PPT, Federal Government
Independent Revenue, Excess Non-oil and Exchange Gain
accounted for 4.3, 3.5, 1.4, 0.3 and 0.1 per cent,
respectively
“The estimated Federal Government expenditure for the
fourth quarter of 2018 stood at N1.83 trillion and was
below the proportionate quarterly budget estimate of
N2.38 trillion by 23.1 per cent and the level in the
preceding quarter by 3.4 per cent. A breakdown of the
total expenditure showed that the recurrent component
accounted for 87.8 per cent, while capital and statutory
transfers accounted for 5.9 and 6.3 per cent,
respectively. A further breakdown of the recurrent
expenditure showed that the non-debt component
accounted for 53.8 per cent, while debt service payments
was 46.2 per cent
Thus, the fiscal operations of the Federal Government
resulted in an estimated deficit of N910.41 billion,
compared with the proportionate quarterly budget deficit
of N488.62 billion.”
Mr Godwin Emefiele answering questions during
his screening by the Senate for Central Bank
Governorship in Abuja on Wednesday
Oil price rises to $63.02, $3.00 in excess of 2019 budget
benchmark
The rise in price was attributed to the efforts of the
Organisation of Petroleum Exporting Countries, OPEC to
remove excess oil from the volatile market.
Specifically, the prices of Brent, West Texas Intermediate,
WTI and Organisation of Petroleum Exporting Countries,
OPEC Basket stood at $63.02, $55.26 and $60.93
respectively.
In its recent report, OPEC that expects increased stability
in the market stated: “The Joint Ministerial Monitoring
Committee (JMMC) has expressed its utmost satisfaction
with the steady and robust achievements of the two-year
old ‘Declaration of Cooperation’ between OPEC and
participating non-OPEC oil producing countries.
“The JMMC noted that countries participating in the
‘Declaration of Cooperation’ achieved an overall
conformity level in November 2018 of slightly below
100%, hitting 98% for the month.
“It is evident that significant progress has been made
towards the goal set at the 4th OPEC and non-OPEC
Ministerial Meeting of 23 June 2018, whereby countries
agreed to strive to adhere to the overall conformity level,
voluntarily adjusted to 100%, as of 1 July 2018 for the
remaining duration of 2018.
“The overall conformity level since the beginning of the
‘Declaration of Cooperation’ in January 2017 is well
above 100%, coming in at 116%.
“The Committee confirmed the attached new voluntary
production adjustments effective as of 1st of January
2019 for an initial period of six months, based on the
unanimous decisions taken at the 175th Meeting of the
OPEC Conference and the 5th OPEC and non-OPEC
Ministerial Meeting on 7 December 2018.”
It stated: “These voluntary production adjustments will
continue to be monitored by the JMMC on a monthly
basis, ably supported by the Joint Technical Committee
and the OPEC Secretariat, in an open and transparent
manner.
“The JMMC calls on all participating countries of the
‘Declaration of Cooperation’ to redouble their efforts in
the full and timely implementation of the supply
adjustments to ensure that the oil market remains in
balance in 2019.”
However, in his budget presentation to the National
Assembly, President Muhammadu Buhari had stated:
“The 2019 Budget Proposal is intended to further place
the economy on the path of inclusive, diversified and
sustainable growth in order to continue to lift significant
numbers of our citizens out of poverty.
“The underlying drivers of the 2019 revenue projections
have been adjusted to reflect current realities. On the
expenditure side, allocations to Ministries, Departments
and Agencies of Government were guided by the 3
objectives of the ERGP, which are, (i) Restoring and
Sustaining Growth; (ii) Investing in our People and (iii)
Building a Globally Competitive Economy.”