Despite the global decline in petroleum prices, fuel consumers in Ghana are unlikely to reap the benefits of expected decreases at the pump.
The rapid depreciation of the cedi is poised to counterbalance any potential reduction in prices during the second petroleum pricing window for May, which commenced on Thursday, May 16.
Analysts anticipate a slight dip in prices, but projections suggest that the devaluation of the cedi will offset this decline.
While international market trends indicate a notable decrease in refined petroleum product prices, with petrol and diesel experiencing drops of 5.68% and 4.51% respectively, according to the Institute of Energy Security, Ghanaian consumers may not see significant relief.
The cedi’s recent depreciation, losing 8-10% of its value over the past fortnight, is expected to neutralize these declines, leaving consumers with minimal savings at best.
Derrick Xaste, a research and policy analyst at IES, highlighted that competitive pricing strategies employed by oil marketing companies (OMCs) may only result in a marginal reduction in prices, approximately 2%.
“We expect prices to reduce but not significantly. If it hadn’t been for the cedi depreciation, the reduction would have been more significant. We expect some form of reduction, but you know the forces of demand and supply and the competitive pricing strategies by the various OMCs might bring some sort of slight reduction because they are all competing for the same consumer base.”
“I cannot predict for them because they all have their pricing strategy, they will equally also make a move depending on their other competitors what they’ll be doing so I cannot take that decision for them but definitely that reduction cannot be more than 2 percent.”
Meanwhile, the Executive Director of the Chamber of Petroleum Consumers, Duncan Amoah has warned that prices may remain stable or even increase if the cedi continues to depreciate.
As of the first day of the pricing window, major OMCs like Goil and Total Energies had maintained their prices, with petrol and diesel selling at GHc14.40 and GHc14.65, respectively.
Consumers are urged to prepare for possible price increases if the cedi’s depreciation continues, highlighting the complex interplay between global market trends, currency fluctuations, and local pricing strategies.
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