The Institute for Energy Security (IES) has projected a slight decrease in prices of fuel at the pumps.

The release, signed by its Principal Research Analyst Richmond Rockson said “on the basis of positive indicators recorded within the period under review; being the stability of the local currency, the drop in crude oil prices and Gasoline and Gasoil prices; the Institute for Energy Security (IES) foresees prices at the pump dropping slightly”.

The statement however says “prices may remain stable at the pumps if OMCs decide to rake in some revenues as a result of recent sacrifices made”.

The Institute for Energy Security IES used the opportunity to renew its call on government to scrap entirely the Special Petroleum Tax (SPT). “The Institute for Energy Security will continue to call on government to show commitment to the people of Ghana by scrapping the Special Petroleum Tax in this era of high fuel prices, as proposed 2% reduction will have no significant impact at the pumps”, the statement concluded.

Review of February 2018 first-pricing window

Local Fuel Market Performance

For three consecutive Pricing-windows depending on the Oil Marketing Company (OMC), consumers have had to pay more for fuel products on the local market. Government’s intervention through the National Petroleum Authority’s stabilisation mechanism was not enough to halt the upward review of prices. Total Petroleum was the first OMC to review prices upward from Ghs 4.63 to Ghs 4.69 for both Gasoline and Gasoil, an increase of 1.3%, before reducing prices to Ghs 4.67 due to competition. The market recorded an increase of between 0.86% and 1.38%. The average pump prices for Gasoline and Gasoil is Ghs 4.66. IES Market scan shows the top 5 OMCs with the cheapest prices on the market are Zen Petroleum, Benab Oil, Pacific Oil, Lucky Oil and Frimps Oil.

World Oil Market Prices

Within the last 14 days, Brent crude has seen a downward trend in price, falling from $69.57 per barrel to close trading at $67.25 per barrel; representing a change of 3.33%. Today, Brent crude is selling at $62.72 per barrel, a sharp decline as compared to prices recorded 4 weeks ago. Platts benchmark shows petroleum products are decreasing in prices, with Gasoline now averaging $656.45 per metric tonne, a 1.9 percentage change. Price per metric tonne for Gasoil reduced from $614.95 to $594.95, a change of 3.25%.

Local Forex and Fuel Stock

The Ghana Cedi remained stable to the US Dollar within the period under review according to figures compiled from the foreign exchange market by IES Economic Desk. The average selling rate of the US Dollar within the period is Ghs 4.52. Between February 1, 2018 and 13th February, 2018, total fuel imports amounts to 93,600 metric tonnes; 35,000 MT Gasoline, 37,000 MT Gasoil, 10,000MT Fuel Oil and 11,600MT LPG.

Projections for February 2018 second-pricing window

On the basis of positive indicators recorded within the period under review; being the stability of the local currency, the drop in crude oil prices and Gasoline and Gasoil prices; the Institute for Energy Security (IES) foresees prices at the pump dropping slightly. However, prices may remain stable at the pumps if OMCs decide to rake in some revenues as a result of recent sacrifices made. In spite of the recovery of global crude oil prices, the Institute for Energy Security will continue to call on government to show commitment to the people of Ghana by scrapping the Special Petroleum Tax in this era of high fuel prices, as proposed 2% reduction will have no significant impact at the pumps.