By Abbanobi -Eku Onyeka
The Senate Committee on Finance has approved a reduction in the oil price benchmark for the 2026 budget from $64.8 to $60 per barrel, citing persistent downward pressure on global oil prices and the need to avoid a widening fiscal deficit.
During a Tuesday briefing, Senator Sani Musa, chairman of the committee, told members of the press: “Since the crisis in the Middle East and part of Europe, oil prices have fallen and have remained largely stagnant with only slight drops and minimal increases. Our production levels have also fluctuated due to force majeure and other factors, making the original $64.8 benchmark unrealistic.”
On the rationale for the cut, he said:
“Global oil markets have been unsettled by geopolitical tensions, leading to sustained low prices.”
“Maintaining a $64.8 benchmark could exacerbate the existing fiscal deficit of approximately ₦2.1 trillion and reducing the projection to $60 per barrel is the best thing to do if we really want to fund the 2026 budget responsibly.”
On the implications, the lawmaker states that the revised benchmark aims to ensure that revenue projections for the 2026 budget are realistic, reducing the risk of shortfalls that could delay funding for capital projects. The committee’s decision underscores the Senate’s focus on fiscal discipline amid uncertain global energy markets.
“We decided to reduce the projection from $64.8 to $60. This will help us avoid serious deficit and keep the 2026 budget on track,” Musa concluded.
