Nigeria’s oil receipts in 2020 are expected to drop by as much as $17 billion, Austin Avuru, the chief executive officer of Seplat Petroleum Development Company, has projected.
Speaking on Nigeria’s oil and gas industry in the face of the current pandemic, Avuru said the combination of the current pandemic and the rapid decline in demand for crude oil globally were reflected in current oil prices.
According to Avuru, it was imperative for oil nations, such as Nigeria, to deepen economic diversification as oil earnings are no longer dependable.
He said: “I think that it has become imperative for the economy to broaden in scope. The overreliance on oil receipts is no longer sustainable.
The 2020 budget is now being restructured by the federal government in line with the expected drop in oil receipts.
The shortfall is expected to be around $17 billion in 2020, which is significantly more than the $3.5 billion that was recently borrowed from the IMF.
“As a result, there is going to be a drastic reduction in government expenditure. A lot of the subsidies will also have to be cut back because the government will no longer be able to afford them.