According to the Institute, the fall in crude and refined oil product on the world market, the marginal loss of the cedi to the U.S. dollar, the stiff competition among the Oil Marketing Companies and the fall in the country’s fuel stock show an expected drop in fuel prices within the first two weeks of this month;
“The Institute for Energy Security foresees a marginal fall in prices at the pump over the first Pricing-window for the month of August 2016. Over the period supply of LPG could see some form of disruption on the local market,” according to a release signed by Gilbert Richmond Rockson, Principal Research Analyst at the Petroleum Unit of the Institute.
Read the rest of the release below:
At the close of the second Pricing window for the month July 2016, the local and the international market recorded drop in prices of petroleum products.
Local Fuel Market
Over the pricing window, the market recorded a reduction of up to 2.22% and 2.27% on Petrol and Diesel respectively. The recorded average reduction on Petrol and Diesel was 1.29% and 1.19% respectively. These reductions in prices were effected by almost all Oil Marketing Companies (OMC). The smaller OMCS competed strongly against the bigger ones and ended up displacing them on the IES Top-10 chart. Today in terms of Diesel prices; Engen Petroleum, Puma Energy, Glory Oil, Lucky Oil and Radiance are the top five (5) OMCs.
World Market Index
Over the period, Platts price for Diesel dropped from $416.25/metric tonne to $393.84/metric ton, representing a change of 5.4%. The average Platts price for Petrol at the close of trading in the second pricing window of July was $454.73/metric tonne as against the price of 473.43 at the close of the first Pricing-window. In effect Petrol on the world market dropped by $18.70/metric tonne representing 3.9%.
Brent crude slid into a bear market from $47.6/barrel recorded at the end of the first window to $43.38/barrel at the end of the second window, representing a drop of 8.9%.
Local Market Index and Inventory
Data from the Bank of Ghana (BOG) suggest that the Cedi recorded some level of stability against the U.S. Dollar in the second Pricing-window of July 2016, with a minimal depreciation of 0.14%.
Over the period, the country’s stock for Diesel and Petrol combined dropped from 540million liters to 407million liters, which is capable of meeting just above five and a half weeks of national fuel security, using June 2016 national fuel (Petrol and Diesel) consumption as basis. The fall in inventory could partly be attributed to the mini shut-down maintenance at Tema Oil Refinery (TOR), oil importers slimming down old stock, and remaining wary of importing additional cargo as a result of continuous fall in world market prices.