Freetown, 3rd August 2026 – Sierra Leone’s hard-won economic stability is under fresh strain as the global oil crisis, triggered by Middle East tensions, forces the government to revise its 2026 budget. Finance Minister Sheku Ahmed Fantamadi Bangura told Parliament on Friday that the surge in international oil prices has “necessitated a revision of the original 2026 macro‑fiscal framework” to protect citizens and preserve budget credibility.
“Recent developments in the global and domestic economy have necessitated a revision of the original 2026 macro-fiscal framework,” Finance Minister Sheku Ahmed Fantamadi Bangura
Oil prices spiked from US$70 per barrel before the crisis to a peak of US$138 in April, driving domestic fuel pump prices up to NLe35 for petrol and NLe40 for diesel. Although a peace deal briefly eased prices to US$72 by June, Bangura admitted that “current price levels are still higher than the pre‑crisis levels,” with inflation climbing to 14.8 percent in June 2026.
To shield households, the government introduced fuel subsidies in April and expanded energy subsidies to the Electricity Distribution and Supply Authority (EDSA). These measures, however, have necessitated a reallocation of capital spending, resulting in the reduction of domestically funded projects by over NLe1.1 billion to accommodate recurrent costs.
Revenue has also taken a hit. Collections from goods and services tax (GST) and customs duties fell short, prompting a downward revision of domestic revenue to NLe21.5 billion (11.5% of GDP). Meanwhile, grants from development partners rose slightly, with the European Union disbursing budget support in January.
The overall deficit is now projected at 2.8 percent of GDP, up from 2.3 percent in the original budget. Domestic financing will rise sharply, with borrowing from commercial banks revised to NLe4.2 billion, a significant jump from the earlier NLe567 million.
Despite these pressures, Bangura assured Parliament that the government remains committed to fiscal discipline: “We will continue to implement prudent fiscal policy underpinned by consolidation, while protecting social spending to mitigate the impact of the crisis on the poor and vulnerable.”
The revised budget underscores Sierra Leone’s vulnerability to external shocks but also highlights the government’s balancing act, cushioning citizens from rising costs while safeguarding macroeconomic stability.
