The Institute for Energy Security, IES, has projected a 3% – 5% rise in petrol and diesel prices at the pumps within the first 2 weeks of December. IES is predicting the rise in the first pricing window of the month due to several varied factors.
This includes the welcoming news of the development of effective COVID-19 vaccines, the loosening of restrictions in parts of Europe and the hope of an extension of the period for production cuts by OPEC-plus countries to at least the first quarter of 2021.
This insightful development has thus pushed Brent Crude Oil price to US$48.53 per barrel, the highest since March this year. Following suit, local fuel prices is expected to rise in December.
World Market price
According to a statement by the IES “Brent crude price within the period saw an increase in average price with the commodity being sold at $45.49 per barrel mark representing an 11.5% increase from the previous window’s average price of $40.54 per barrel mark.
The increase is attributable to the renewed hopes of a COVID-19 vaccine following other announcements by major vaccine producers within the period.
The period also saw the loosening of restrictions in parts of Europe that shored up prices for Brent. The seeming end to the US election drama also influenced the price of the Brent. Also, and more importantly, the hopes of an OPEC+ production cuts extension to at least the first quarter of 2021 saw a boost in bullish sentiments on the international market.
The period recorded the highest price for the benchmark since early March this year, selling at $48.53 per barrel mark on Wednesday, 25th November 2020.”
Local oil price and forex market
According to IES, the current national average price of fuel per liter at the pump is pegged at GHS 4.61.
“Prices of fuel on the local market remained stable within the window under review. Prices of petroleum products within the second Pricing-window of November 2020 saw the majority of Oil Marketing Companies (OMCs) maintaining prices of Gasoline and Gasoil. The current national average price of fuel per litre at the pump is pegged at GHc 4.61,”
IES review statement of November second pricing- window revealed.
Giving the current national average price of GH¢4.61 per litre with the projected increment of 3%-5%, Ghanaians can expect to pay between GH¢4.77 – GH¢4.84 per litre in the first few weeks of December.
IES revealed that the Cedi is maintaining its stability against the U.S. Dollar. It is still trading at an average price of Gh¢5.76 to the U.S. Dollar over the period.
Impact on transport fares
According to IES, the projected 3% – 5 % increase in fuel prices at the pumps in the first pricing window of December, is not expected to lead to an increase in transport fares. In an interview monitored by Ghana Talks Business, Fritz Moses, a research analyst at IES said the government should be ready to implement the price stabilization levy which is intended to insulate consumers against rising prices of fuel.