Ghana’s fuel market is heading into a mixed pricing cycle, with petrol and Liquefied Petroleum Gas (LPG) expected to record marginal reductions while diesel could become more expensive from Monday, August 17.
The expected changes come against the backdrop of volatile international oil prices, movements in refined petroleum products and recent changes in the value of the cedi.
Data from the Chamber of Oil Marketing Companies (COMAC) indicate that petrol could decline by as much as 2.90 per cent, potentially bringing the indicative pump price to about GH¢15.82 per litre.
Diesel, on the other hand, is projected to increase by 1.39 per cent to approximately GH¢17.73 per litre, while LPG could record a marginal reduction of 0.93 per cent to about GH¢16.21 per kilogramme.
However, consumers may not immediately see the full impact of the projected changes at filling stations.
Chief Executive of the Chamber of Petroleum Consumers (COPEC), speaking to JOYBUSINESS, expects a significant number of Oil Marketing Companies (OMCs) to maintain their existing pump prices despite the changes in market fundamentals.
Ghana has more than 200 OMCs, giving individual operators some flexibility in determining their prices within the regulatory framework.
Global Market Drives Mixed Price Outlook
The latest price movements have largely been influenced by developments in the international petroleum market.
COMAC said average crude oil prices increased by 2.02 per cent to US$90.41 per barrel in mid-August, driven partly by geopolitical tensions and concerns over possible disruptions to crude supplies around the Strait of Hormuz.
However, refined petroleum products moved in different directions during the period.
International diesel prices increased by 2.86 per cent, while petrol and LPG prices declined by 5.46 per cent and 2.54 per cent respectively.
COMAC attributed the mixed movement to uncertainty surrounding the US-Iran dispute and higher global crude oil prices.
The Chamber said the government-industry intervention would continue to cushion consumers against the impact of higher diesel prices.
It added that sustained appreciation of the cedi could create room for further reductions in domestic fuel prices in subsequent pricing windows.
The cedi had weakened by 1.20 per cent against the US dollar to GH¢11.7995 between July 27 and August 11, based on bank averages.
The local currency, however, subsequently strengthened, with the Bank of Ghana’s rate standing at GH¢10.9855 to the dollar on August 14.
NPA Cuts Price Floors
The latest market developments also coincide with a reduction in the National Petroleum Authority’s (NPA) price floors for the second pricing window of August, which began on August 16.
The approved petrol price floor has been reduced from GH¢14.53 to GH¢13.92 per litre, representing a reduction of GH¢0.61, or approximately 4.1 per cent.
The diesel price floor has also been lowered from GH¢16.97 to GH¢15.19 per litre, a reduction of GH¢1.78 or 10.48 per cent.
For LPG, the price floor has been marginally reduced from GH¢11.06 to GH¢10.98 per kilogramme.
The NPA has reminded OMCs and LPG Marketing Companies that they are prohibited from selling petroleum products below the approved price floors during the current pricing window.
Despite the lower regulatory price floors and the expected decline in petrol and LPG prices, market conditions suggest that pump prices could vary from one OMC to another.
Consumers may therefore see different prices at filling stations, with some operators potentially opting to retain their current prices rather than immediately pass on the expected market changes.
