Gov’t Must Revise Petroleum Revenue Projections amid Falling Oil Prices
By: Solomon Nartey Tetteh
Economic Analyst Emmanuel Boateng has called on government to immediately revise its petroleum revenue projections downward to reflect current realities in the global oil market, warning that overly optimistic assumptions could trigger a significant fiscal shortfall.
Speaking on Business Breakfast on Zed FM, Mr. Boateng said the country’s current revenue assumptions, which peg crude oil prices around USD70 to USD75 per barrel, no longer align with prevailing market conditions.
He explained that prudent fiscal management requires conservative forecasting to guard against unexpected revenue losses.
According to him, projecting oil prices too high exposes the economy to fiscal risks if prices decline sharply.
“If you peg oil at USD70 to USD75 and it falls to USD60 or USD62, then clearly there will be a fiscal slippage,” he warned.
Mr. Boateng cautioned that maintaining optimistic projections could result in a revenue shortfall of between GH¢3 billion and GH¢4 billion, with serious consequences for government financing.
“That kind of gap will force emergency domestic borrowing halfway through the year, and at very punitive interest rates,” he said.
He therefore urged fiscal authorities to urgently review and adjust petroleum revenue assumptions to avoid unplanned borrowing and to ensure greater stability in budget implementation.
The Analyst also called on government to freeze non-critical expenditure linked to the Annual Public Financial Adjustment and Review (APFAR) as part of efforts to keep public finances within sustainable limits.
Mr. Boateng said expenditure controls are necessary in the current economic climate, stressing that not all budgeted spending should proceed as planned.
He also called for a more aggressive approach to revenue mobilisation and public education on fiscal measures.
Mr. Boateng further stressed the need to accelerate revenue strategies alongside education efforts to ensure broader understanding and compliance, noting that stronger domestic revenue generation is critical to maintaining fiscal stability.
