REVIEW OF AUGUST 2017 SECOND PRICING-WINDOW

Local Fuel Market Performance

One major news that characterized the second Pricing-window for the month of August 2017, was the withdrawal of the new fuel standard of 50 parts per million (PPM). The Ministry of Energy was forced to take the action due to the continuous hikes in fuel prices at the pump, which is rendering the government unpopular.

For the period under review, Gasoline and Gasoil rose by average of 3.21% and 3.55% respectively. Today, a litre of Gasoline (Petrol) sells for Ghs4.09, with Gasoil selling at Ghs4.08, the highest in the last eight Pricing-windows. Over the month of August, fuel prices at the pump rose between 7.9% and 10% on the local market.

Frimps Oil, Zen Petroleum and Lucky Oil are selling the cheapest fuel at the pump, according to IES Market-scan.
World Oil Market Prices

Brent crude price declined to close at an average price of $51.33 per barrel from a previous figure of $52.19 per barrel, suggesting a percentage change of 1.64%. This is largely as a result of the storm in U.S, which has affected crude demand. The storm and the hurricane, which preceded it, have forced US oil producers and refiners to shut down, although they are now beginning to resume production after the bad weather moved onshore.

Standard and Poor’s Platts benchmark for Gasoline and Gasoil showed slight change in prices. Gasoline increased by 0.15%, from $551.10 per metric tonne to $551.93, with Gasoil recording a 2.43% drop to close at 473.10 per metric tonne.
Local Forex and Fuel Stock

Figures compiled from the banking sector by our Economic Desk shows the Ghana Cedi continues to depreciate as the local currency closed an average of Ghs4.44 from a previous average of Ghs4.41. This is the eighth time in nine Pricing-windows that the cedi has depreciated.
Also the combined stock of Gasoline and Gasoil in the country has risen to 304million litres, and can ensure 4 weeks and three days of national demand.

PROJECTIONS FOR SEPTEMBER 2017 FIRST PRICING-WINDOW

Taking into consideration the marginal fall in the price of crude oil, the relatively stable prices for finished products on the international market, and the suspension of the recently implemented fuel standards; the Institute for Energy Security (IES) foresees local fuel prices remaining unchanged in the first Pricing-window for the month of September 2017. However, the continuous rise in the Dollar against the Ghana Cedi may produce some shocks at the pump.