Nigeria’s 2016 N6 trillion budget plunged deeper into funding problems with Brent crude price falling below $28 a barrel in Asia on Monday.

Nigeria had based its budget estimate at an oil price of $38.The declining price will further widen the deficit target.

The sliding oil price predicted to fall even further to about $10 in weeks, plunged to $28 today over fears about a worsening supply glut after Western sanctions on Iran were lifted, allowing Tehran to resume oil exports.

Up to half a million barrels per day of Iranian crude could be added to already saturated markets after US and European leaders ended a crippling embargo put in place over Tehran’s nuclear programme.

The news led to further selling of the black gold, which has fallen by about three quarter since mid-2014 owing to the supply glut, record output levels, weak demand and a slowing global economy

Brent for March delivery tumbled to as low as $27.67, or by 4.4 percent from Friday’s close, before rebounding to trade at above $28. The last time Brent closed below $28 was in November 2003.

At around 0250 GMT, the contract was trading 39 cents, or 1.35 percent, lower at 28.55. US benchmark West Texas Intermediate for delivery in February was down 30 cents, or 1.02 percent, at $29.12.

“The drop was due to the Western sanctions on Iran being lifted. This means we will be seeing a bigger oil glut with Iranian crude exports coming back to the market,” said Phillip Futures analyst Daniel Ang.

Ric Spooner, chief market analyst at CMC Markets in Sydney, said that while Iranian oil could come in quickly, suppliers still needed to find buyers.

“Iran has quite a large storage of oil at the moment. They are in a position to sell that if they choose to do so and increase supply quite quickly,” Spooner told AFP.