Nigeria’s Oil Revenue Drops by N62 Billion

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Nigeria’s oil revenue dropped for the second month in a row due to shut-ins and shutdowns of major terminals by the Nigerian National Petroleum Corporation, NNPC, according to the Central Bank of Nigeria, CBN, May 2019 monthly economic report. 

The report which was published on Friday revealed that Nigeria’s oil receipts for May slumped to N410.18 billion, compared to April’s earning from the oil sector estimated at N472.38 billion with a difference of N62.2 billion.

Oil receipts refer to all proceeds from crude oil in transit which means money accrued from crude oil from taxes on import and export except for crude oil in transit by pipeline.

Nigeria’s monetary regulator indicated in the report that the federally collected revenue in May was N733.82 billion, which falls short of the projected monthly budget earnings of N1,107.12 billion stipulated in the 2019 budget.

This led to a 33.7 per cent drop in earnings for the federal government which the CBN blamed on the shortfall in receipts from oil revenue which is a major contributor to the economy.

“Gross oil receipts, at N410.18bn or 55.9 per cent of the total revenue, was below both the monthly budget of N640.21bn by 35.9 per cent and the preceding month’s receipts of N472.38bn by 13.2 per cent, respectively.

“The decline is relative to the provisional monthly budget estimate was attributed to shut-ins and shutdowns at some NNPC terminals due to pipeline leakages and maintenance activities,” the report reads.

However, the report stated that the gross total earning from oil fell from N516.88 billion in March to N472.28 billion in April, which distorted the federally-collected revenue for the month under review.

On non-oil revenue, the CBN stated that at N323.64bn which accounts for 44.1 per cent of the total revenue, non-oil revenue fell below the provisional monthly budget estimate of N466.91 billion by 30.7 per cent.

“It exceeds the preceding month’s receipt of N322.93bn by 0.2 per cent. The lower non-oil revenue relative to the provisional monthly budget was due to the shortfalls in receipts from all the non-oil revenue components, except customs and excise duties,” the CBN stated.

The report also hints that N667.29 billion was the retained revenue in the Federation Account, the sums of N92.63bn, N48.76bn and N24.73bn were transferred to the VAT Pool Account, the Federal Government Independent revenue and “others”, respectively, leaving a net balance of N501.18bn for distribution to the three tiers of government.

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