Oil Price Fall Hits Federal Government Allocation
The total money that Nigerian government earn in a month and could share to the states and local governments, reduced by 36.1 billion in February as oil prices dropped from $49.57 to $44.74 per barrel.
Revenue fell to 429.127 billion Naira in February from 465.19 billion Naira in January also due to attempts to sabotage its oil pipelines, a government statement said on Tuesday.
"Production diminished during the period due largely to leakages in the pipelines arising from sabotage," the statement added.
This is bad news for the government which is hoping that the oil price will continue to rise and help it overcome economic recession.
The implication is government will also have to improve on its efforts at tackling militancy in the Niger Delta region which has helped compound its woes.
Attacks have halted in recent months with talks between the government and Delta community leaders to address the grievances of militants, who want the oil hub to receive a greater share of the country's energy wealth.