Fuel Prices to Remain Stable for 2nd Pricing Window in May
The Institute of Energy Security, IES, says consumers and stakeholders should not be expecting any major change in the prices of fuel and other petroleum products at the various pumps from the second pricing window, which begins on Saturday, May 16, 2020, and will end on Sunday, May 31, 2020.
The energy think tank ascribes this to the marginal rise in fuel prices on the global market as well as the depreciation of the cedi.
“Going by the 5.31% and 17.96% appreciation in prices of Crude oil and Gasoline respectively, and the fact that Gasoil tumbled by 8.14% on the international market; the Institute for Energy Security (IES) foresees prices of fuel on the local market remaining largely unchanged in the second Pricing-window of May 2020,” IES stated in its recent analysis.
It added that: “The expected stability in prices of fuels at the pump, takes into account the local currency’s marginal depreciation against the U.S. Dollar.”
For the last pricing window which ends on Friday, May 15, 2020, the various Oil Marketing Companies reduced their ex-pump prices by about 5%.
On average, a litre each of petrol and diesel sold for 4 cedis 6 pesewas.
“While Goil, Shell (Vivo), Petrosol, Puma and Total Ghana trimmed their prices to sell at an average per-litre price of Gh¢4.09 for Gasoil and Gh¢4.11 for Gasoline, few other Oil Marketing Companies (OMCs) moved their prices below the Gh¢4.00 per litre mark, to produce a national average price of Gh¢4.01 for Gasoline and Gh¢4.03 for Gasoil,” IES added.
The global performance of crude oil prices and its influence on the local market
Brent crude and West Texas Intermediate, WTI, prices have due to the coronavirus pandemic and its impacts on the global economy, been plunging since early this year. The May contract of U.S. West Texas Intermediate plunged below zero to trade in negative territory for the first time in history and that happened shortly after a historic oil price plunge on stock markets. Nonetheless, Brent crude and WTI prices are starting to bounce back to its former glory on stock markets.
In the analysis, IES said that “Brent crude appreciated by 5.31% from $25.98 per barrel recorded at the end of the second Pricing-window of April to close at $27.36 per barrel on average terms at end of the first Pricing-window in May 2020.”
Brent crude price remained largely above the $25 per barrel mark for the Pricing-window under assessment. Over the period, Brent crude has been steadily gaining on markets and has been able to hit $30 a barrel for the first time since April 15.
“This positive gain can be attributed to the easing of restrictions in economic activities around the world, as well as reaction to the start of production cuts,” the IES said.