Ms Dugdale called on the SNP leader to "just do the decent thing and admit the SNP's plan to scrap Barnett would be devastating for Scotland".

Ms Sturgeon told her that when the Scottish Government had forecast oil prices of 110 US dollars a barrel, the OBR was predicting 100 US dollars (£67), while the UK Government Department of Energy and Climate Change was "projecting an oil price of upwards of 120 US dollars (£80) a barrel".

She said: "I think it's fair to say everybody's projections about oil were wrong."

The OBR is now forecasting that oil will raise less than £1bn in revenues for each of the five years to 2019-20.

But Ms Sturgeon argued that while revenues from the North Sea are declining, the amount of money Scotland raised from on-shore, non-oil revenues is on the increase.

She hit out at Labour and said: "I think the most revealing thing about Labour is how they gleefully pounce on anything they can describe as bad news and steadfastly ignore anything that is good news about Scotland's economic prospects.

"The fact is the projected decline in oil revenues over the next few years is dwarfed in every single one of those years in the projected growth in our on-shore, non-oil revenues.

"In other words our revenues as a country are increasing, our public finances are improving. I know that doesn't suit Labour's narrative but it happens to be a fact."

She said the Scottish Government would "take the time to analyse the fiscal changes" for the oil and gas industry that Chancellor George Osborne announced as part of his Budget yesterday.

The First Minister added: "When we have done that as soon as is feasible we will publish an updated oil and gas bulletin."

Ms Dugdale, who had challenged the SNP leader on the issue at First Minister's Questions, said she was pleased Ms Sturgeon had "finally run out of excuses and will publish a new oil and gas bulletin".

The Labour MSP insisted: "This isn't some dry statistical exercise, this is about the SNP's key general election demand for full fiscal autonomy in the UK, a plan that would scrap the stability of higher public spending through Barnett for the austerity max of relying on oil revenues."

She added: "The SNP's plans for full fiscal autonomy rests on an oil price of 110 US dollars a barrel, yet the OBR has revised down its predictions for the oil price, they now predict an oil price next year of more than 40 US dollars (£27) a barrel lower than the SNP."

Ms Sturgeon told her: "If we look to the year 2019/20, yes we will see oil revenues projected to decrease by £3bn compared to 2013/14. In that same year our on-shore, non-oil revenues will increase by £15bn.

Source: news.stv.tv

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