An Expert in Economic Policy and Development who doubles as a lecturer at Pentecost University, *Dr. Alexander Amo Baffour*, has described President *John Dramani Mahama’s* decision to reduce fuel prices by *GH¢2 per litre* for one month as a “strategic and forthright” intervention to cushion Ghanaians from rising global energy costs.
*Context: Global Oil Shock Drives Local Prices Up*
The relief comes at a time when global crude oil markets have been under severe pressure.
Following escalating tensions and US military strikes in Iran amid the *US-Israel-Iran conflict*, Brent crude surged past *$86/barrel* in July 2026, while West Texas Intermediate (WTI) traded around *$83/barrel*. The uncertainty also disrupted shipping through the Strait of Hormuz, through which 20% of the world’s oil passes, triggering risk premiums.
For Ghana, an oil-importing economy, the impact has been direct. Despite being an OPEC observer and a modest producer via Jubilee and TEN fields, Ghana imports refined petroleum products priced off international benchmarks plus freight, insurance, and forex costs.
Data from the Chamber of Petroleum Consumers (COPEC) and OMCs showed that in the *1st and 2nd pricing windows of 2026*, petrol and diesel saw near-constant increases. By late July, *petrol was selling at GH¢15.00 per litre* and *diesel at GH¢19.00 per litre* at most pumps across Accra, Kumasi and other regions. This sparked public backlash from motorists, traders, and transport unions who cited “artificial shortages” and margins that pushed prices above average disposable incomes.
*Government Intervention: One-Month GH¢2 Relief*
In response, Government, through the *Minister of Government Communications and Presidential Spokesperson, Hon. Felix Kwakye Ofosu (MP)*, announced a *one-month state intervention* through a Press Statement on Monday August 3rd , 2026 to absorb GH¢2 from the price of both petrol and diesel. The move is aimed at “ameliorating the situation and giving citizens some sigh of relief” during the period of global turbulence.
Dr. Amo Baffour said the timing was critical.
> “This is a timely and benevolent move. The President’s commitment is clearly geared towards sound economic recovery, not plunging the masses into a dreadful economic abyss. President Mahama has once again proven to be a listening President and must be applauded.”
*Linking the Cut to the Broader “Reset Agenda”*
The lecturer, who is also a National Vice Chairman hopeful of the National Democratic Congress ( NDC), noted that the intervention aligns with the Mahama administration’s
*socio-economic recovery agenda*.
He argued that deliberate policy decisions like this ensure “equity and fairness in the discharge of government’s mandate.” According to him, the “resetting agenda” is on course and requires collective effort to fulfill campaign promises.
“President Mahama’s style of leadership is exemplifying the successes we have chalked in the economy so far. The intentional path to economic recovery has opened opportunities for strategic investment, making Ghana one of the best investment destinations in Sub-Saharan Africa,” he added.
*Call for Transport Fare Compliance & Macro Stability*
Dr. Amo Baffour urged the *Ministry of Transport* to engage transport unions to ensure fare reductions reflect the fuel cut, to prevent “over-expectation and exploitation” of the motoring public.
He also credited technical policy coordination by *GOLDBOD* and the *Bank of Ghana* for helping the *Ministry of Finance* stabilize the cedi and control inflation. He said prudent management and reduced wastage in the production value chain have made the economy more resilient.
“These multifaceted efforts have largely contributed to making the economy robust and able to withstand major global shocks, unlike many advanced economies that are currently struggling,” he stated.
Meanwhile, Energy experts say the sustainability of the GH¢2 subsidy will depend on global crude trends and exchange rate stability. With Brent still hovering above $80/barrel due to Middle East risks, OMCs will be watching the next pricing window closely.
Dr. Amo Baffour further noted that the GH¢2 per litre reduction on diesel is expected to provide significant relief to Small and Medium-sized Enterprises (SMEs) and industries whose operations rely heavily on diesel-powered equipment, generators, and transportation. He explained that the intervention could lower production and distribution costs, improve business cash flow, and help businesses maintain stable prices for goods and services despite global oil market volatility.
“Diesel is the lifeblood of many productive sectors of the economy. This intervention will cushion SMEs, manufacturers, agro-processing firms, transport operators, construction companies, and other industries against rising operational costs. Ultimately, it has the potential to preserve jobs, ease inflationary pressures, and enhance business confidence during this period of global uncertainty,” Dr. Amo Baffour stated.
For now, consumers in Ghana can expect some relief at the pumps as government steps in to shield households from the worst of the global oil storm.
By Nana Dogbe.
