The Institute for Energy Security (IES) has predicted a reduction in fuel prices in the first Pricing-window in the month of March.
The Energy Think Tank based its prediction on factors such as the stability of the local currency, the over six per cent reduction in the price of petrol, the 4.63% drop in diesel price as well as the average 3.33% reduction in Brent crude price.
This second consecutive dip in prices at the pump is seen as a relief for petroleum consumers considering the several price hikes experienced in 2017.
For the first time in 2018, petroleum consumers had a sigh of relief as fuel prices at the pump saw a reduction, though marginal. This was as a result of favourable indicators recorded on the international fuel market and government’s reduction of Special Petroleum Tax from 15% to 13%, which has been made a specific tax of 46 pesewas.
Total reduction on a litre of Gasoline was 16 pesewas whilst Gasoil saw an 18 pesewas reduction.
The Energy Sector Levies Act, 2015 (ESLA) Act 899 was enacted in 2015; the objective of the act was to consolidate existing energy sector levies to ensure efficient utilisation of proceeds generated from the levies, impose a Price Stabilisation and Recovery Levy to facilitate sustainable long-term investments in the energy sector, and to provide for other related matters.
In 2017, the Special Petroleum Tax (Amendment) Bill, 2017, amended the Special Petroleum Tax Act, 2014 (Act 879), and as a result reduced the rate of the Special Petroleum Tax on petroleum products from 17.5% to 15%.
This means that the New Patriotic Party (NPP) government has reduced the tax on petroleum products by 4.5 per cent.
Reduction in diesel and LPG
In November last year, the National Petroleum Authority (NPA) directed all Oil Marketing Companies and LPG Marketing Companies to use revised prices in the Price Stabilisation and Recovery Levy (PSRL) Act to control recent price increases in petroleum products.
Per the directive, diesel, with a PSRL of 10 pesewas per litre, was reduced by 7 pesewas per a litre of PSRL on it, representing 7 pesewas drop on each litre of diesel.
Similarly, the price of Liquefied Petroleum Gas (LPG) was also revised by that same margin.
“Currently, a gallon of petrol could be sold to you on average terms at GH₵20.30, with diesel going for GH₵20.21. IES Market scan shows Zen Petroelum, Benab Oil, Pacific, Lucky Oil and Puma Energy selling at the lowest price per litre at the pump,” Principal Research Analyst, Richmond Rockson said in a statement.
World oil market prices
Brent crude price within the period under review saw a reduction in average price, as the commodity dropped from $67.25 per barrel to close trading at $65.01 per barrel, representing a change of 3.33%.
According to Standard and Poor’s Global Platts benchmark for finished products, prices of Gasoline and Gasoil saw a decline on the global fuel market.
Price of Petrol per metric tonne dropped by 6.11% from $656.45 to $616.32. Diesel closed the window at an average of $567.43 per metric tonne from a previous average of $594.95 per metric tonne, a change of 4.63 percent.
Local forex and fuel stock
The Ghana Cedi remained relatively stable according to statistics put together by IES Economic Desk from the foreign exchange market, with the US dollar shedding some marginal value against the local currency. The Ghana Cedi closed trading at an average rate of Ghs 4.51, an appreciation of 0.22%.
From February 16, 2018, to February 27, 2018, total fuel imported into the country were 144,900 metric tonnes - 62,000 metric tonnes of Gasoline, 55,000 metric tonnes of Gasoil, 14,900 metric tonnes of Fuel oil and 13,000 metric tonnes of LPG.
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