Some experts in the oil and gas industry on Wednesday said there was no cause for alarm over the increase in the crude oil benchmark from $45 per barrel to $50.5 per barrel.
They told the News Agency of Nigeria (NAN) in separate interviews with in Lagos that the trade war between China and United States had led to the reduction of the price of crude oil at the international market.
The former President of the Society for Petroleum Engineers (SPE), Saka Matemilola, said the benchmark in the 2018 budget was very sensible at $50.5 per barrel.
According to Metemilola, the benchmark of $50.5 per barrel is very sensible because he does not expect oil price to go below $55 per barrel by the end of the year.
He said irrespective of what happens between China and the U.S; oil price will not go below $55 per barrel this year.
"What we should be concerned about is how we can utilise the savings from excess crude price which goes to excess crude account. How do we spend this savings that will impact meaningfully on average Nigerians.
"There is a huge infrastructural gap that needs to be closed. Infrastructures like hospitals, roads and power need to be invested in so that Nigerians can feel the impact of rising crude oil price," he said.
Segun Adaju, the Chief Executive Officer of Consistent Energy, said, "Naturally, oil price fluctuates and the benchmark price of $50.5/barrel in the 2018 budget is an average for the year 2018."
According to him, it is certain that oil price may not go below $50.5 per barrel this year, with half of the year gone, adding that there is nothing to be worried about.
Debo Ahmed, the Chairman, Western Zone of the Independent Petroleum Marketers Association of Nigeria (IPMAN) said it would also bring hope to the populace and boost the economy.
Mr Ahmed described the crude oil benchmark at $50.5 per barrel as the right thing to do, considering the current price of crude oil globally which today stood at the $70 threshold.
"Crude was $80 per barrel before it dropped to $70 due to the rifted between China and United States of America.
"I think $50.5 is even conservative but it is better to be on the safe side, so for me it is a commendable effort," Ahmed said.
NAN reports that the Federal Executive Council (FEC) had on October 26, 2017 approved the 2018 draft budget of N8.612 trillion but NASS increased the budget to N9.12 trillion.
The Senate also increased the crude oil benchmark for the budget from $45 per barrel to $50.5 per barrel in the 2018 budget.
Crude oil production was bench-marked at 2.3 million barrels per day with an exchange rate of N305 to one dollar.