Oil prices fell from over $100 per barrel early last year to as low as $40 per barrel in December 2014. Over 70 per cent of Nigeria’s gross revenue comes from the sale of crude oil which resulted in a drop of N265.28bn in the revenue generated by the country.
Any fall or increase in the price or production of the commodity usually has some effect on the revenue earned by the Federal Government.
Data obtained on Friday from the Office of the Accountant-General of the Federation for the fourth quarter 2014, as analysed by the Central Bank of Nigeria, showed that Nigeria’s gross oil revenue fell by 15.49 per cent.
Further findings revealed that as a result of the plunge in crude oil prices and its attendant effect on Nigeria’s earnings, the country’s gross oil revenue was unable to meet 19.17 per cent of its budgetary target.
The OAGF, in a report released by the CBN, stated, “At N1.448tn, gross oil revenue declined respectively by N265.28bn or 15.49 per cent and N90.56bn or 5.89 per cent, below the levels in the third quarter of 2014 and the corresponding quarter of 2013.
“Oil revenue accounted for 72.4 per cent of gross revenue during the review quarter, while the balance of 27.6 per cent was from non-oil sources. Gross oil revenue met 80.83 per cent of budgetary target of N1.791tn.”
As a result of the global crash in oil prices, the country’s gross federally-collected revenue during the period under review also fell by N480.74bn or 19.38 per cent. The amount of revenue collected, according to the report, was N1.999tn.
The report said, “Gross federally-collected revenue amounted to N1.999tn during the fourth quarter of 2014, representing decreases of N480.74bn or 19.38 per cent and N57.61bn or 2.8 per cent, below the levels in the preceding quarter and corresponding quarter of 2013, respectively. The revenue collections met 81.8 per cent budget performance.”
The report also indicated that the federally-collected revenue for the third quarter of 2014 was N2.057tn, but this fell by almost half of a trillion naira in the fourth quarter.
Oil producers in Nigeria and experts in the sector have stated that Nigeria may lose over N2tn in 2015 alone, if the fall in the crude oil prices persists.