The Institute for Energy Studies (IES) is predicting a hike in fuel prices this month.

“Guided by the fundamental indicators such as rise in price of Gasoline, Gasoil and Brent crude on the international oil market, the country’s fuel stock as well as the fair-stability of the country’s local currency against the U.S. Dollar; the Institute for Energy Security (IES) sees fuel prices primed to rise again on the local market by up to 2.5%,” said the Energy think-tank in its review of April 2018 First pricing-window.

“This imminent price increase may be averted by an intervention from the National Petroleum Authority (NPA) if it decides to trigger the Price Stabilization mechanism in the second Pricing-window for April 2018,” it added.

Below is the full statement

FUEL PRICES TO SHOOT UP AGAIN

REVIEW OF APRIL 2018 FIRST PRICING-WINDOW

Local Fuel Market Performance

Over the last two weeks, consumers of fuel have had to pay more for petroleum products purchased at the pump. As projected by the institute, all Oil Marketing Companies (OMCs) increased prices of Gasoline and Gasoil at an average of 2%. The national average selling price of a litre of Gasoline and Gasoline currently stands at Ghs 4.57 and Ghs 4.56 respectively.

IES-Market scan indicates Zen Petroleum, Benab Oil, Pacific, Lucky Oil and Frimps Oil lead the chart of Oil Marketing Companies (OMCs) selling the cheapest fuel per litre at the pump.

World Oil Market Prices

Within the period under review, Brent crude closed trading at $68.96 per barrel from a previous average of $66.85, representing 3.16%. And Brent is in position to post extra gains within the next two weeks due to shrinking global oil inventories and concerns over the escalating military activities in the Middle East. As at today Brent crude is trading around $72.00 per barrel mark, one of the highest averages in recent times.

According to Standard and Poor’s Global Platts benchmark for Gasoline and Gasoil, prices of both products recorded increments on the international fuel market. Gasoline closed trading at $681.80 per metric tonne from a previous average of $645.77, a change of 5.58%. Gasoil also saw a price change of 4.90%, from a previous average of $587.73 per metric tonne to close at $616.53 per metric tonne.

Local Forex and Fuel Stock

Data recorded from the foreign exchange market by IES Economic Unit suggests a fairly stable local currency, as the Ghana Cedi closed trading at Ghs 4.55 to a U.S. Dollar, with a depreciation of 0.89%.

From April 1, 2018 to date, total petroleum imports recorded stands at 225,886 metric tonne; 98,220 metric tonnes of Gasoline, 120,516 metric tonnes of Gasoil and 7,150 metric tonnes of Butane were imported into the country.

PROJECTIONS FOR APRIL 2018 SECOND PRICING-WINDOW

Guided by the fundamental indicators such as rise in price of Gasoline, Gasoil and Brent crude on the international oil market, the country’s fuel stock as well as the fair-stability of the country’s local currency against the U.S. Dollar; the Institute for Energy Security (IES) sees fuel prices primed to rise again on the local market by up to 2.5%. This imminent price increase may be averted by an intervention from the National Petroleum Authority (NPA) if it decides to trigger the Price Stabilization mechanism in the second Pricing-window for April 2018.

Signed: RICHMOND ROCKSON

(Principal Research Analyst, IES)