The bad news is; the price of crude oil fell to $46.69 a barrel on Wednesday, January 7, while the good news is; the price fall may reduce petrol cost and subsidy payments.
The new price of crude oil represents the lowest price since April 2009.
The meltdown in crude oil prices, which was caused by oversupply and sluggish demand growth, has led it to spiral more than 55% from its June peak of $107.
With the price of the global benchmark Brent crude now at $46.69 per barrel, Nigerian government is now paying just 90 kobo as subsidy for a litre of petrol.
Another ripple effect of the oil price fall is the landing cost of petrol, which dropped to N82.41 per litre from N127.57.
With the retail price of petrol at N97, the Federal Government’s spending on petrol subsidy has consequently fallen to a five-year low of N0.90 per litre, compared to N44.94 in November 2014
Nigeria has changed its benchmark twice in the last few weeks, from $78 to $73 and lately to $65.
Crude oil, which accounts for more than 70 per cent of government revenue and 95 per cent of foreign-exchange income, has fallen in price by 37 per cent this year.
According to experts, the price of crude oil would still fall below $40 a barrel over the coming months as market forces shake out the weakest producers, hence the need to diversify the economy.