ABUJA – Nigeria said it aims to produce 1.88 million barrels per day of crude oil next year and that the budget will be based on the benchmark price of $ 57 per barrel, calling it a production target. ” very conservative “while the country’s economy is struggling.
Africa’s most populous country has been hit hard by the coronavirus pandemic, insecurity and falling global oil prices, vital to its oil-dependent economy.
The government said on Wednesday that a Senate committee had approved spending plans for the next three years, called the Medium-Term Expenditure Framework (MTEF), which projected gross domestic product growth of 4.2 percent and inflation of 13% for 2022.
The upper house has also given the green light for daily crude oil production of 1.88 million barrels per day (mbpd) for next year, 2.23 mbpd for 2023 and 2.22 mbpd for 2024 “in sight averaging 1.93 mbpd over the past few years “.
These numbers represent an increase from oil production of 1.47 mbd this year, when the budget was based on $ 40 a barrel.
The upper house said that “a very conservative oil production benchmark has been adopted in the medium term in order to ensure greater budgetary realism”.
The Senate committee recommended the MTEF, saying it was “deliberately designed to minimize the negative socio-economic consequences of the relentless COVID-19 pandemic and other crises unique to our country.”
The estimates were reviewed by the Senate ahead of the presentation of the 2021 Appropriations Bill by President Muhammadu Buhari later in the year.
As economic growth has rebounded from being hit by the pandemic, insecurity, kidnappings and criminal attacks have increased this year in northwestern and central states and food inflation remains stubbornly high.
Annual inflation stood at 17.01 percent in August, driven largely by rising food prices.
Nigeria has sought local and external loans to fund its 2021 budget, execute critical infrastructure projects, tackle Covid-19 and tackle growing insecurity.
Last week, Buhari sought parliamentary approval for nearly $ 5 billion in additional external borrowing.