There are strong indications that the price of petroleum may go up from N87 to N97 next year.

This is the plan of the Federal Government going by the speech of Minister of State for Petroleum, Dr. Ibe Kachukwu on Monday.

He said that the government would have to stop paying fuel subsidy to save money for capital project ad in doing so would not have option than to allow fuel price hike.

As he put it, “Price of refined products today is N87. It was N97 before it was reduced and we really have to go back to that because we don’t really have the finance to remove it,” Minister of State for Petroleum Resources.”

According to him, there are lots of safety barometer between the N87 and N97per litre regime between which government doesn’t not have to fund subsidy, adding, “Yet the prices would be fairly close to what it used to be today. That is the first mechanism we are going to work.”

Speaking with joint committee of the Senate and House of Representatives, Kachikwu urged them to consider the 2016, 2017 and 2018 Medium Term Expenditure Framework (MTEF).

Also speaking, the Minister of Budget and Planning Udoma Udo-Udoma spoke of strict measures which may lead to more austere conditions.

He said:”In preparing the MTEF, we seek a dramatic shift from spending on recurrent to spending on capital aspect of the budget.
“It is going to be tighter for everybody. All non-essential expenditure would be cut out. We will reduce the overheads by seven per cent.

“We are beginning a journey of change and change has to start with the clarity of purpose of where we are going.”
On sources of funding for the N6 trillion 2016 budget, Udoma said priority will be given to Internally Generated Revenue (IGR).

He said: “We will also look at the accounts of agencies and sweep those surpluses that might not be on essential things that we want to focus on”
The Minister informed the joint committee that “ultimately we must borrow N1.8 trillion to fund this budget apart from all those adjustments we are trying to make”