If feelers coming from Ghana are anything to go by, fuel price in the country is heading to exceed 8 cedis by March from the current price of 6.9 cedis. This revelation was made by Kwaku Agyeman Duah, Chief Executive of the Association of Oil Marketing Companies on a recent radio interview in Accra.
According to Duah, the price hike is not unconnected to the continuous depreciation of the Ghana Cedi against the US dollar, as well as the rise in petroleum products on the international market. Both of these factors have caused an uptick in the cost of retail petrol to increase.
When asked on Ghana’s Joy FM how long the current price could stay in place, he gave March as the reply. “The short-term one is up to March, we sure will be crossing the 8 cedis per litre.”
Just at the end of January, there was a 3% increase in the price of petrol in Ghana, going from 6.70 cedis to 6.9. The Institute for Energy Security (IES) predicted that the prices of Liquefied Petroleum Gas (LPG), diesel and petrol were likely to go up by 25 pesewas per litre from February 1.
In its statement, the IES said “Over the next two weeks, the Institute for Energy Security (IES) foresees the prices of Liquefied Petroleum Gas (LPG), diesel, and petrol recording yet another jump at the pump, in spite of a suspension of the Price Stabilisation and Recovery Levy (PSRL). Further depreciation of the Ghana cedi against the US dollar on the foreign exchange (forex) market adds to the factors that will push up the prices of the commodities on the local market.”
Unsurprisingly, the resultant pressure has caused an increase in the cost of daily living for most Ghanaians as transport operators have announced their preparedness to increase fares by as much as 30% in the coming days. A number of oil marketing companies have also shut down due to the high cost of doing business.
Ghana’s credit rating was downgraded for the second time in three weeks after ratings agency Moody reviewed it downwards from a B3 to a CAA1, only a fortnight following Standard & Poor’s rating of B-minus from a B. The Akufo-Addo led government has however disagreed with these ratings, calling on international rating agencies to key relevant data was left out in reaching this conclusion.