The Senate and House of Representatives differ over the oil benchmark in the approval of the 2026–2028 Medium-Term Expenditure Framework and Fiscal Strategy Paper (MTEF/FSP)
The House of Representatives on Thursday adopted the Federal Government’s proposed crude oil benchmark of $64.85 per barrel for 2026 under the 2026–2028 Medium-Term Expenditure Framework and Fiscal Strategy Paper (MTEF/FSP), setting itself apart from the Senate, which earlier approved a lower benchmark of $60 for the same year.
The decision followed renewed consideration and adoption of a report by the House Committees on Finance and National Planning and Economic Development, which endorsed the executive’s oil price assumptions of $64.85, $64.30 and $65.50 per barrel for 2026, 2027 and 2028, respectively.
The House had on Wednesday stepped down deliberation on the MTEF/FSP after sharp disagreements over proposals to revise the oil benchmark. The Speaker, Tajudeen Abbas, had warned that lowering the benchmark without clearly identifying how the resulting revenue shortfall would be accommodated, either through higher non-oil revenue or increased borrowing, would weaken the credibility and internal consistency of the framework.
Concerns were also raised over the late submission of the documents, said to be in breach of the Fiscal Responsibility Act (FRA), 2007.
In contrast, the Senate, while approving the MTEF/FSP on Tuesday, reviewed the oil benchmark downward to $60 per barrel for 2026, before adjusting it to $65 for 2027 and $70 for 2028.
Chairman of the Senate Committee on Finance, Senator Sani Musa (APC, Niger East), said the adjustments were informed by geopolitical tensions in Europe and the Middle East, as well as volatility in the global oil market.
Despite the divergence on oil price assumptions, both chambers retained identical crude oil production projections of 1.84 million barrels per day (mbpd) for 2026, 1.88 mbpd for 2027 and 1.92 mbpd for 2028.
The House also approved exchange rate projections of ₦1,512, ₦1,432.15 and ₦1,383.18 for 2026, 2027 and 2028, respectively, alongside inflation targets of 16.5 per cent, 13 per cent and nine per cent over the same period.
Real GDP growth estimates of 4.68 per cent for 2026, 5.96 per cent for 2027 and 7.9 per cent for 2028 were similarly sustained, with lawmakers expressing optimism that ongoing reforms and new tax laws would begin to yield tangible gains from 2026.
As part of its recommendations, the House urged the effective implementation of the newly enacted Tax Acts and called on the Federal Government to deploy a National Scanning Policy within the National Single Window of the Nigeria Revenue Service to enhance revenue assurance, improve trade facilitation, curb leakages and strengthen transparency and national security.
On the fiscal framework, the House sustained the proposed 2026 budget size of ₦54.46 trillion, with retained revenue estimated at ₦31.83 trillion. New borrowings were put at ₦20.38 trillion, while debt service was projected at ₦15.52 trillion. The framework also retained ₦1.376 trillion for pensions, gratuities and retirees’ benefits, alongside a fiscal deficit of ₦22.63 trillion.
Capital expenditure, excluding transfers, was sustained at ₦20.131 trillion, statutory transfers at ₦3.152 trillion, and the sinking fund at ₦388.54 billion. Total recurrent (non-debt) expenditure was projected at ₦15.265 trillion, with special interventions for recurrent and capital spending pegged at ₦200 billion and ₦14 billion, respectively.
Lawmakers said the retention of the key macroeconomic assumptions was premised on expectations that tax reforms and broader economic restructuring would support fiscal stability and growth over the medium term.
