News Guide Africa

Tag: Fuel price

  • Fuel Price Relief: A cushion for consumers, a burden for industry

    Fuel Price Relief: A cushion for consumers, a burden for industry

    By Adnan Adams Mohammed

    In a move designed to buffer Ghanaians against the volatile international oil market, the National Petroleum Authority (NPA) has slashed the price floors for the April 16 pricing window.

    While the decision has forced transport operators to shelve planned fare hikes, industry experts warn that the intervention comes with a GH¢200 million price tag for the government and a mounting debt crisis for private oil companies.

    As at last week, the price of diesel has seen its most significant drop in recent history, falling from GH¢17.10 to GH¢16.10 per litre. Petrol prices followed with a marginal decrease to GH¢13.27. Major retailers, including GOIL and Star Oil, have already adjusted their pumps to reflect these new floors.

    The government’s “necessary sacrifice”

    The intervention, approved by Cabinet, is a direct response to global price hikes fueled by geopolitical tensions in the Middle East. According to the Energy Ministry, the government is absorbing GH¢2.00 per litre on diesel and GH¢0.36 per litre on petrol for the next one month period.

    “This will lead to a net loss of about GH¢200 million that could have accrued to the government, but it is a necessary sacrifice to bring relief to the people of Ghana,” stated Richmond Rockson, Spokesperson for the Ministry of Energy.

    This financial cushion was enough to convince transport unions to back down from a proposed 20% increase in fares, providing immediate relief to millions of commuters.

    Industry fears: “We are financing government policy”

    However, the celebration at the pumps is not shared by the Chamber of Oil Marketing Companies (COMAC), Dr. Riverson Oppong, CEO of COMAC, raised the alarm that the relief is being funded through industry operational margins rather than tax cuts.

    “The relief… stems from operational margins of the industry, and it has not touched any tax or levies that go into the government coffers,” Dr. Oppong argued. He warned that Oil Marketing Companies (OMCs) are effectively being forced to pre-finance the government’s social intervention.

    “Is just unfortunate… the downstream business is always receiving the burden for the government; we are the ones always coming to solve problems for the government,” Dr. Oppong added, noting that for every 10 million litres lifted, a company could face over GH¢600,000 in debt due to the delayed reimbursement from the state.

    The lag in economic impact

    While the price at the pump has dropped, the Africa Centre for Energy Policy (ACEP) cautions that the broader cost of living may not fall as quickly. Ben Boakye, Executive Director of ACEP, explained that the “pass-through effect” of fuel prices is notoriously slow.

    “You’re not going to have goods and services reduced or the impact reversed almost immediately,” Boakye noted during a Joy News interview. “Businesses often delay passing on cost reductions because people always want to make a margin. They want to watch this space to see whether they can even keep the same prices.”

    What lies ahead?

    As OMCs begin negotiations with the Ghana Revenue Authority (GRA) for tax payment delays to ease their liquidity crunch, all eyes remain on the Middle East. The current relief measure is set to last only 30 days. If global crude prices remain elevated, the government will face a difficult choice: extend the costly GH¢200 million-a-month subsidy or allow the prices to surge, potentially reigniting the threat of transport strikes and runaway inflation.

     

     

  • Fuel Price Cuts Spark Call for Transport Fare Reductions

    Fuel Price Cuts Spark Call for Transport Fare Reductions

    By Adnan Adams Mohammed

     

    The Ghana petroleum market is witnessing heightened competition and a welcome drop in fuel prices, a trend that is now putting pressure on commercial transport operators to reduce fares for consumers.

    The Chamber of Petroleum Consumers (COPEC) is leading the charge, urging all commercial transporters, including major ride-hailing services like Bolt, Uber, and Yango, to immediately review and adjust their fares in line with the recent reductions in ex-pump prices. The move is aimed at passing on the benefits of easing cost pressures to the general public.

     

    COPEC’s Executive Secretary, Duncan Amoah, in a statement, pointed to the downward adjustments in pump prices by some oil marketing companies within the current pricing window.

    The Chamber said the reductions are consistent with movements in international refined petroleum prices, relative stability in the exchange rate, and heightened competition within Ghana’s deregulated downstream petroleum market.

    COPEC’s year-on-year assessment further shows that consumers are recording significant savings under the current pricing window, with petrol and diesel prices down by between GH¢3 and GH¢4 per litre compared with January 2025.

    “In this regard, COPEC calls on OMCs that have not yet reviewed prices within the current window to do so promptly, ensuring pump prices reflect prevailing market conditions and serve the broader interest of consumers.

    “Consumers must not be denied the benefit of price reductions when international and local market conditions become favourable,” the statement concluded.

    A Market Correction

    The recent price adjustments by Oil Marketing Companies (OMCs) are a result of several favourable factors: stability in the cedi’s exchange rate, movements in international refined petroleum prices, and intensified competition within Ghana’s deregulated downstream sector.

     

    Market leader Star Oil initiated significant cuts this week, with a litre of petrol now selling for as low as GH¢10.56 (and promotional discounts down to GH¢10.36), and diesel at GH¢11.56. State-owned GOIL has followed suit, with petrol priced at GH¢10.99.

     

    This marks a significant improvement from January 2025, with COPEC highlighting year-on-year savings of between GH¢3 and GH¢4 per litre for consumers.

    “Consumers must not be denied the benefit of price reductions when international and local market conditions become favourable,” stated Duncan Amoah, Executive Secretary of COPEC.

     

    The Push for Consumer Relief

    COPEC commended the proactive OMCs but stressed that fair and responsive fuel pricing is essential to alleviating financial pressures on households and businesses. The organisation is now focusing its attention on the transport sector.

    Current pump prices indicate significant variations across OMCs, with a price difference of over 10% between the lowest and highest priced petrol.

    Company    Petrol  (per litre)          Diesel (per litre)

    Star Oil          GH¢10.56                       GH¢11.56

    GOIL              GH¢10.99                    GH¢11.96

    TotalEnergies/Shell GH¢11.68       GH¢12.38

    PETROSOL                 GH¢11.65        GH¢12.35

     

    The call for fare reductions echoes a similar situation in May of last year, when transport fares dropped by 15% following negotiations between operators and the Ministry of Transport, leveraging the cedi’s appreciation at the time.

     

    As OMCs continue to cut prices amid rising competition, the pressure mounts on transport unions and ride-hailing platforms to translate these savings into lower fares, ensuring the benefits of improved market conditions reach the everyday Ghanaian consumer.

     

  • Stabilise cedi to contain fuel price pressures – COMAC tells gov’t

    Stabilise cedi to contain fuel price pressures – COMAC tells gov’t

    The Chamber of Oil Marketing Companies (COMAC) is asking the government to take steps to curb the cedi’s depreciation to help stabilize fuel prices at the pumps.

    The call comes as the local currency, which had previously strengthened and driven prices down, has recently shown renewed signs of weakness.

    The Board Chairman of the Chamber of Oil Marketing Companies (COMAC), Gabriel Kumi, made the comment at the annual petroleum industry fun games, PetFun 2025, which brought together staff, executives of member oil marketing companies, and other service providers across Ghana for a day of sporting competition, team building, and wellness.Ghanaian Cultural ToursActivewear

    Gabriel Kumi, in an interview with the media on the sidelines of the event, underscored the importance of the government keeping the cedi stable.

    “At the media engagement, the President gave certain assurances that the Finance Ministry and the Economic Management Team are working very hard to stabilize the cedi. The depreciation of the cedi contributes to a very large extent towards the increment we have seen in recent years on the price of the product but comparatively it is still good.

    “If you look at the fact that this government took the cedi from about GHȼ17 [ to a dollar] and we are now around GHȼ12 [to a dollar], it is still good, but what this current government needs to do is to make sure that they put a tap on the cedi so that it doesn’t go up any further.

    “If the cedi goes up, we at COMAC have very little control over the pump price. Our goal is to ensure that the price of the product continues to remain low,” he said.

    Dr. Riverson Oppong, Chief Executive Officer of the Chamber, projected fuel price hikes in the second pricing window of September, due to recent depreciation of the cedi, while also calling for a more robust energy sector.

    “The pricing outlook is out, and we have seen some increase. We are still waiting for the floor price to determine what variables are changing. But from the outlook, you can see the cedi has depreciated a bit, which will obviously affect the pricing from Monday,” he remarked.

    “It is a bit dicey in the country called Ghana. We are looking forward to having very solid and comprehensive policies that will ensure the energy sector is paying for itself, paying its dues, and even contributing to the economy of this country,” Dr. Riverson Oppong subsequently added.Ghanaian Cultural Tours

    Meanwhile, some participants in this year’s PetFun shared their reasons for taking part.

    “Sometimes we work very hard in the office and some of our people don’t have the time to go out and I think for a good life balance, it is very good. We should have it more often,” Vivo Energy Ghana Managing Director Christian Li said.Ghanaian Cultural Tours

    “We came here to de-stress, have fun and exercise our bodies and to share solidarity with all other industry players,” Communications Manager for TotalEnergies Marketing Ghana PLC Endesha Ampofo also added.

  • Businesses and transport operators expected to reduce prices

    Businesses and transport operators expected to reduce prices

    By: Memuna Asuma

    Players in the trade, commerce, industries and transport businesses are expected to reduce their market prices as inflation and forex exchange rates keep improving.

     

    Reacting to the current rate of inflation which dropped to 45% for the month of March 2023, the Government Statistician has indicated that the continuous drop in the prices of petroleum products and other goods and services are yet to reflect in transport fares. This is due to its slow impact on other factors of transportation, he noted.

     

    Although the drop in diesel and petrol prices for some time has been significant, it will translate into transport fares if spare parts and other component of the transportation sub-class record same reduction. However, Ghana Union of Traders Association (GUTA) has called on its members to respond positively to the improved economic position of the country and adjust prices accordingly.

     

    “Yes, we have seen some drops in diesel and petrol prices for the past few months. But one must bear in mind that other factors that makes up the component like the taxi cost and spare parts or materials are yet to get the impact of these reductions”,  Professor Samuel Kobina Annim said last week, at a press briefing.

     

    The rate of inflation for the month of March 2023 slowdown as a result of some historic deflation recorded in the Food and Non-alcoholic Beverage group during the period February 2023 and March 2023.

     

    Professor Annim believes that the Consumer Price Index has been consistent with the decline in inflation since the beginning of the year, a situation he attributes to many factors.

     

    Meanwhile, in a statement issued last week by GUTA, efforts by the government and the Bank of Ghana to bring down inflation and exchange rate are commendable, hence the call on its members to cut prices of goods.

     

    “GUTA, entreats all members of the business community to respond positively to the changing trend and adjust prices to reflect the exchange rate. We express our pleasure to the government and the Bank of Ghana for their efforts at bringing down inflation and exchange rate”.

     

    It urged government to continue with the efforts and take advantage of the reduction of the exchange rate to further reduce inflation and other costs of doing business in the country.

     

    It added that this could be achieved by adjusting customs valuation rate to reflect the current trend of the exchange rate.

     

    “We wish to urge government to continue with the efforts and take the advantage of the reduction of the exchange rate to further reduce inflation and other costs of doing business. Adjusting customs valuation rate to reflect the current trend of the exchange rate”.

     

    Last week, the cedi gained across the major trading currencies in the foreign exchange market following progress on Ghana’s negotiations with its bilateral creditors.

     

    It gained 10.27% week-on-week against the US dollar in the retail market to close at a mid-rate of ¢10.95 to one US dollar on Thursday, April 6, 2023.

     

    Also, inflation for March 2023 fall sharply to 45%, influenced by some deflation of items in both the Food and Non-Alcoholic Beverages group and Non-food inflation.

  • Fuel price reducedas predicted

    Fuel price reducedas predicted

    Adnan Adams Mohammed

    Fuel prices at the pumps have started coming down although slower than expectations of some downstream petroleum sector think-tanks.

    GOIL, a market leader, reduced the pump prices for Diesel to GH₵19.77Petrol toGH₵16.26, this translate into about 3.5 percent reduction.

    Although, the reductions were predicted in previous week by the Institute for Energy Security, the current reduction is slower than the rates it predicted.  IES predicted rates of about 13.45% in petrol,  11.63% in diesel, and 1.88% in LPG prices.   

    “Prices of the various finished products will be affected by the 13.45% fall in the price of gasoline [petrol], the 11.63% fall in the price of gasoil [diesel], and the 1.88% fall in the price of LPG.

    However, the IES said the price of Liquefied Petroleum Gas (LPG), is however expected to remain stable on account of the cedi’s depreciation.

    The 3.09% depreciation of the cedi against the US dollar is expected to erode portions of the gains from the reductions in international fuel prices. The price of LPG is however expected to remain stable on account of the cedi’s depreciation”, the IES said.

    Condequently, the Chamber of the Bulk Oil distributors has linked the reductions to improved supply of dollars from the Bank of Ghana and moves by the regulator to improve the liquidity of commercial banks.

    This has helped improved lending to importers of petroleum products.  

    On the international market, Brent crude saw a 6.31% decrease in price over the previous window’s average price of $95.11 per barrel to the present average price of $89.11 per barrel.

  • Govt announces new gold buy policy

    Govt announces new gold buy policy

    Adnan Adams Mohammed

    As government keeps innovating ideas to tackle the perennial depreciation of the local currency against the international trading currencies (especially, US dollar), a negotiation to allow importers use gold to pay for imported petroleum products is ongoing.

    The Government believes that, the new policy regime will fundamentally change the country’s balance of payments and significantly reduce the persistent depreciation of the currency with its associated increases in fuel prices.

    The vice president in a facebook post had reiterated that, the demand for foreign exchange by oil importers in the face of dwindling foreign exchange reserves results in the depreciation of the cedi and increases in the cost of living with higher prices for fuel, transportation, utilities, etc. To address this challenge, Government is negotiating a new policy regime where our gold (rather than our US dollar reserves) will be used to buy oil products. The barter of sustainably mined gold for oil is one of the most important economic policy changes in Ghana since independence.

    “If we implement it as envisioned, it will fundamentally change our balance of payments and significantly reduce the persistent depreciation of our currency with its associated increases in fuel, electricity, water, transport, and food prices”, Dr Mahmud Bawumia hoped. “This is because the exchange rate (spot or forward) will no longer directly enter the formula for the determination of fuel or utility prices since all the domestic sellers of fuel will no longer need foreign exchange to import oil products.”

    The barter of gold for oil represents a major structural change. My thanks to the Ministers for Lands and Natural Resources, Energy, and Finance, Precious Minerals Marketing Company, The Ghana Chamber of Mines and the Governor of the Bank of Ghana for their supportive work on this new policy. We expect this new framework to be fully operational by the end of the first quarter of 2023.

    To successfully achieve the target result from the intended policy, the Minister for Lands and Natural Resources, Samuel A. Jinapor has just issued the following directives:

    1. Effective 1st January, 2023, all large scale mining companies (as agreed with the Bank of Ghana) shall sell twenty percent (20%) of all refined gold at their refineries to the Bank of Ghana (in Ghana Cedis) before the export of the gold. The Bank of Ghana and the Precious Minerals Marketing Company (PMMC) will coordinate with the large scale mining companies to ensure compliance with this directive.

     2. Effective 1st January, 2023, all Community Mining Schemes (CMS) shall sell their gold outputs to Government through PMMC. All mining licences for CMS shall include a clause mandating licensees to sell their gold output to Government.

    3. Effective 1st January, 2023, all Licensed Small Scale Gold Miners shall sell their gold to Government through PMMC. All small scale gold mining licences shall include a clause mandating licensees to sell their gold to Government.

    4. The gold to be purchased by the Bank of Ghana and the PMMC will be in cedis at spot price with no discounts.

    These directives would also help local gold refineries obtain gold supplies from PMMC to support their operations as they work toward obtaining the required London Bullion Market (LBMA) certification.  

  • Cheaper fuel from Dubai: stakeholders speak hard to gov’t

    Cheaper fuel from Dubai: stakeholders speak hard to gov’t

    Adnan Adams Mohammed

    Key stakeholders in the energy sector have given a strong swap at government’s statement that, it has sent delegation to United Arab Emirate to negotiate a cheap fuel deal for Ghana.

    In past days the country experienced astronomic increase in fuel prices doubling the already hard economic conditions of the citizens. President Akufo-Addo in his latest address to the nation on the state of the economy revealed that his government is working to stabilise prices of petroleum products through new supply arrangements in a bid to tackle the high cost of living.

    However, the former Chief Executive of the Ghana Chamber of Bulk Oil Distributors, Senyo Hosi, has urged government to be modest about its promise to get affordable petroleum products to the Ghanaian market. According to him, the price of fuel is dependent on the stability of the currency and other macro-economic realities but not the location of the commodity is bought and therefore believes that the skyrocketing fuel prices will only decline with the appreciation of the cedi.

    “So I’ll encourage government to be a bit more modest in the promises he gives to the public otherwise he will raise expectations that sometimes he just may not be able to sustain” Senyo Hosi cautioned. “So just manage your communication and expectations.”

    He also asked government to engage industry players and the banks in any major decisions.

    Consequently, the Executive Director of Institute of Energy Security, Nana Amoasi VII, has questioned the prudence in government’s efforts to obtain inexpensive fuel.

    He believes the mission is far from possible. Explaining that, no international market would be willing to give out petroleum products at a cheap discount.

    “I don’t know who is advising the Energy Minister, because the venture they are undertaking is far from possibility. This is not how the energy sector works, so they should be careful,” he said.

    Nana Amoasi VII hoped that the quest to get cheap and reliable fuel is not an attempt to “waste the country’s meager resources or an attempt to enrich a few people to the detriment of over 30 million Ghanaians or a deliberate attempt to grow the energy sector debt.”

    He noted that given the case that the team is successful in their quest, they should be made to declare the full discount value they are able to negotiate.

    “They must tell Ghanaians what they also gave in return for that favour. And also, we must be very careful, our fear as IES is that they could be giving out something for free in order to get that discount.

    “If there is a market that can give you a cheap discount to beat all the markets all over the world, I am sure the BDCs would have gone for it. So let us be careful of the venture that we are undertaking,” he cautioned.

    In a related development, the Ranking Member on the Energy Committee in Parliament, John Jinapor has cautioned the government against its plans to secure cheaper petroleum products for the Ghanaian market.

    He argued that nowhere across the globe, would the government obtain petroleum products at the much cheaper price and discounted margins it is looking for.

    “In this petroleum industry, there is nothing like free lunch. They also have their challenges, but more specifically like I stated we are expecting some timelines from the President probably within one month or two months or three weeks or one week,” he noted.

  • Cheap Fuel: BDCs need special forex access arrangement – Analysts

    Cheap Fuel: BDCs need special forex access arrangement – Analysts

    Adnan Adams Mohammed

    A former Chief Executive  Officer (CEO) of both downstream and upstream petroluem sector of Ghana has added his vice to the call that government address the structural challenge on how importers, Bulk Oil Distribution Companies (BDCs) acquire foreign currencies for their business.

    Alexander K. Mould believes the structural problem of making forex available can be addressed by  streamlining the process by BoG working with NPA to make foreign currency available to the commercial Banks of the BDCs;

    The call by the former CEO of National Petroleum Authority (NPA) and Ghana National Petroleum Corporation (GNPC) was a followup to concerns raised by an Energy Policy Analyst  that the foreign exchange rates used by BDCs and OMCs in determining fuel prices are too high. According to the Analyst, the oil companies used a forex rate of between GHC18 and GHS19 to the dollar in setting the prices in this current price window

    “The forex rate they are using is too high ……if they use that forex rate to set prices within two weeks and the cedi depreciates the BDCs will be affected not government,” Benjamin Nsiah said in an interview.

    However, Mr Mould has noted that, the long credit period –another structural problem in the industry –  is basically to accommodate the challenges in sourcing forex.

    In a galloping inflation and galloping exchange rate regime, you can’t wait long to pay back what is owed as the exposure is marked-to- market.

    “Availability of forex is the biggest challenge facing the BDCs.”

    Me Mould, who is a former corporate banker and a former  Executive Director of Standard Chartered Bank, has called on the BDCs and OMCs to better manage their forex trade aspect of their business and suggested some possible ways they could do that.

    “Managing the forex exposure is the key risk they face and as such they should be better manager this risk by buying dollars as soon as they sell the fuel, at least on a weekly basis, and not wait till when the Letter of Credit, or suppliers, credit is dues.

    “The BDCs should also move away from given OMCs more than 7 days credit.”

    “The forex price is unpredictable due to the speculation caused by the short supply and lack of any assurance from BoG of future forex flows;  If BoG make any allocation, the allocation willl first go to GOIL then  to others.”

    Consequently, Mr Nsiah urged the government to work with the BDCs to reach an agreement and sign a Memorandum to reduce the forex rates.

    He added that if the BDCs fail to comply, government can elevate Bulk Oil Storage and Transportation Company Limited (BOST) to compete with the BDCs. He added that BOST should be made “to import products into this country and sell it on the market.”

    “That 60 million dollars given to BDCs to set the prices, if the government handed it to BOST for instance to import the products, it would help all of us,” he said.

    On Tuesday, petrol and diesel prices were sold for an average of ¢18 and ¢23 per litre, from the previous prices of ¢15 and ¢19 per litre respectively.

    Presently, the price of crude oil on the world market is relatively stable, selling at $90 per barrel;

    Meanwhile, in relieving the Ghanaian from the fuel hikes, Information Minister, Kojo Oppong Nkrumah disclosed that the government  is sourcing cheap and affordable petroleum products for supply into the Ghanaian market.

    According to him, the National Petroleum Authority (NPA) and the Ministry of Energy will provide further details about the importation of fuel onto the Ghanaian market in the coming days.

    He noted that the Energy Ministry had already begun talks with some major sources and sovereigns in the supply of petroleum products.

    “In President Kufuor’s time, we did it with Nigeria, Sahara lifting for us and you could have supply credit lines and a fixed price that you could bank on and it is a very similar arrangement that has already commenced and I am expecting that in the coming weeks the NPA, the Energy Ministry will have the opportunity to provide the details,” he said.

  • Inflation to rise further as commercial transport fares to go up

    Inflation to rise further as commercial transport fares to go up

    Adnan Adams Mohammed

    Ghanaians have to prepare for a hyper inflation in coming months, as members of the Ghana Private Road Transport Union (GPRTU) is prepares to announce new transport fares across the country today, from Monday, 24 October 2022.

    The Head of Communications of the Union, Mr Abass Ibrahim Moro, said this in an interview with the media.

    He said the union was earlier targeting a 30 to 40 per cent increase in transport fares in parity with the recent rise in the prices of petroleum products. However, he assured the public that the fare hikes will be reasonable.

    The fare increment is justified on the basis of fuel price hikes at the pumps.

    Petrol has been selling at around GH¢13.10 while diesel is selling at GH¢15.99 at the pumps since last week.

    Some analysts expect further increases as the demand for gas and fuel increases as winter approaches.

    Fuel prices have gone up consistently since the beginning of the year, a situation many economists think has contributed greatly the skyrocketing inflation

    Transport services is one of the major sectors of the economy that affect almost the entire economy. The slightest upwards price adjustment in the sector triggers inflation rise.

    Already, inflation in the country is around 37.2% as at September.   

  • Expects up to 6% drop in fuel prices this month

    Expects up to 6% drop in fuel prices this month

    Adnan Adams Mohammed

    Chamber of Petroleum Consumers (COPEC) has predicted a drop of  6 percent in fuel prices at the pumps.

    The price drop is expected to range between 3% and 6% from August 1st, 2022. The expected reduction will have been bigger if not for the depreciation of the cedi against the U.S dollar.

    The drop in fuel prices will be the second consecutive time since oil prices started falling on the world market.

    “What, we picked from the market for the first window of August [2022] is an indication that prices at the pumps should have gone down significantly. The unfortunate thing at this point happens to be with the currency [cedi]”, Executive Secretary of COPEC, Duncan Amoah, said in an interview, last week. “As I speak with you, over the two weeks window, the FX has seen some depreciation, from about ¢8.30 to about ¢8.90 pesewas currently.”

    “And so that could on its own erode the reductions that you and I could have seen at the various pumps”, he added.

    Mr. Amoah urged government to take a second look at the deregulation policy to cushion consumers against the high fuel prices.

    “We have said on a good number of occasions, that the earlier we take a second look at this whole regulation programme, the better it would be”.