Despite a significant drop in global oil prices, Ghanaian consumers continue to grapple with high fuel costs, as the depreciation of the local currency, the Cedi, undermines any potential relief at the pumps.
Globally, Brent crude oil prices fell by 5.65% during the first pricing window of February 2025, closing at $74.74 per barrel. Similarly, prices of refined products followed a downward trajectory, with gasoil dropping by 4.50%, gasoline by 1.26%, and Liquefied Petroleum Gas (LPG) by 0.22%. Under normal circumstances, such reductions would translate into lower fuel prices for consumers.
However, the Ghanaian Cedi’s 2.18% depreciation against the U.S. Dollar during the same period has effectively cancelled out the benefits of the global price drop. As a result, fuel prices in Ghana have risen for the third time this year, according to the Institute for Energy Security (IES).
Rising Fuel Costs
In the latest adjustment, gasoil prices increased by GH₵0.45 per litre, while gasoline prices rose by GH₵0.24 per litre. This pushed national average prices to GH₵15.61 per litre for gasoline and GH₵15.65 per litre for gasoil. Meanwhile, LPG prices remain elevated at GH₵18.79 per kilogram, further straining household budgets.
Amid these price hikes, consumers are actively seeking more affordable alternatives. Companies like Benab Oil, Star Oil, and Zen Petroleum have been identified as offering the lowest prices in the market.
A Mixed Outlook
Looking ahead to the second pricing window of February, the IES predicts a mixed outcome for fuel prices in Ghana. While global trends suggest the possibility of reductions in the prices of liquid fuels like gasoline and gasoil, the continued depreciation of the Cedi could dilute these effects. LPG prices, on the other hand, are expected to remain unchanged.
The Broader Impact
The current situation highlights the vulnerability of Ghana’s economy to currency fluctuations. For motorists and households, the anticipated relief at the pumps remains elusive, as currency instability continues to exert upward pressure on fuel costs.
This scenario also underscores the need for robust economic measures to stabilize the Cedi and cushion consumers against the double impact of global market volatility and local currency depreciation. Until then, Ghanaian consumers must brace for further uncertainty at the pumps.
In a global economy where oil prices are declining, Ghana’s unique challenges underscore how domestic economic factors can override international trends, leaving consumers caught in the crossfire.
Story by: Mercy Addai Turkson #ahotoronline.com
