L
LequteMan
Guest
Nigeria- The fall in the price of crude oil in the international market is sending economic and political shocks around the world.
The hardest hit has been countries whose economies depend largely on oil for appreciable percentage of their foreign exchange earnings.
According to experts, crude oil accounts for about 95 of Nigeria’s foreign exchange receipts.
The reality of possible crippling budget shortfalls also stares many oil exporting countries in the face as the priced commodity has hit its lowest price level in four years.
Crude oil prices started dropping in the international market from as high as 110 dollars per barrel in January to the current level of 58 dollars.
Nigeria’s reference crude, the Bonny Light, is currently trading at about 62 dollars per barrel.
It is noteworthy that crude oil is not just the principal export commodity of the country, but indeed all aspects of the nation’s economy rely on the commodity as the major source of revenue.
The annual budgets, which define the direction that the country, is based on crude oil price benchmarks.
While the 2014 budget was based on 78 dollars per barrel, the 2015 has been predicated at 65 dollars per barrel.
According to Dr Ngozi Okonjo-Iweala, the Minister of Finance and Coordinating Minister of the Economy, the fall in oil prices has led to new austerity measures.
The minister said the country would begin to feel the negative impact of the fall in global oil prices, cautioning that the country would need to brace up for tougher times ahead by reviewing its expenditures and building economic buffers through budgets based on modest oil prices.
She said that the decline in crude oil prices had assumed a disturbing dimension.
``Without a doubt, this slowdown in global economic activities, coupled with the end in the quantitative easing in the U. S., will affect the sub-Saharan African economy, in addition to regions’ other specific challenges.
``As we all know, many countries on the continent depend on commodity exports as their main sources of revenue.
``Nigeria and other countries on the African continent must step back and learn the lessons of the ongoing economic transformation.
``The Federal Government has set up a strong stabilisation policy, but the most important being that we must be able to sustain the drive”.
#Nigeria #OkonjoIweala
The hardest hit has been countries whose economies depend largely on oil for appreciable percentage of their foreign exchange earnings.
According to experts, crude oil accounts for about 95 of Nigeria’s foreign exchange receipts.
The reality of possible crippling budget shortfalls also stares many oil exporting countries in the face as the priced commodity has hit its lowest price level in four years.
Crude oil prices started dropping in the international market from as high as 110 dollars per barrel in January to the current level of 58 dollars.
Nigeria’s reference crude, the Bonny Light, is currently trading at about 62 dollars per barrel.
It is noteworthy that crude oil is not just the principal export commodity of the country, but indeed all aspects of the nation’s economy rely on the commodity as the major source of revenue.
The annual budgets, which define the direction that the country, is based on crude oil price benchmarks.
While the 2014 budget was based on 78 dollars per barrel, the 2015 has been predicated at 65 dollars per barrel.
According to Dr Ngozi Okonjo-Iweala, the Minister of Finance and Coordinating Minister of the Economy, the fall in oil prices has led to new austerity measures.
The minister said the country would begin to feel the negative impact of the fall in global oil prices, cautioning that the country would need to brace up for tougher times ahead by reviewing its expenditures and building economic buffers through budgets based on modest oil prices.
She said that the decline in crude oil prices had assumed a disturbing dimension.
``Without a doubt, this slowdown in global economic activities, coupled with the end in the quantitative easing in the U. S., will affect the sub-Saharan African economy, in addition to regions’ other specific challenges.
``As we all know, many countries on the continent depend on commodity exports as their main sources of revenue.
``Nigeria and other countries on the African continent must step back and learn the lessons of the ongoing economic transformation.
``The Federal Government has set up a strong stabilisation policy, but the most important being that we must be able to sustain the drive”.
#Nigeria #OkonjoIweala