Niger Delta Avengers Oil Pipeline Bombing Puts Black Hole In 2016 Budget - Vanguard

 

Reports and statistics put together by Vanguard shows that the unfortunate bombing of oil facilities in the Niger Delta by a militant group known as Niger Delta Avengers has caused a massive deficit in the 2016 budget that was signed by President Buhari last Friday.

According to the report,

"The Federal Government had based the budgeted revenue on oil production of 2.2 million barrel per day but oil industry reports, last weekend, after the second attack on oil installations, indicated that output would be around 1.6 mbpd or even less.

Also, the budgeted oil price benchmark of $38 per barrel came with expectation that in the event of production shortfall, which had been consistent since this year, a premium of at least 20 per cent on the price benchmark which gives about $45.6 per barrel, would make up for the losses arising from output shortfalls.

But oil price receded to $41 per barrel, or less than 10 per cent premium on budgeted price benchmark as against $46.1 per barrel peak recorded in the previous week.

With the twin developments in the oil sector, the Federal Government is now losing about $8 million per day on oil price reversal, while production slump has resulted in a revenue loss to the tune of about $22.8 million per day."

Apparently aware of the implications of these sudden developments last weekend while signing the budget, President Buhari said: “We are working night and day to diversify the economy so that we never again have to rely on one commodity to survive as a country.”