Bank of Ghana hints of possible fuel price hikes

Current world market prices of crude and uncertainties in the global economy are likely to affect the pricing of petroleum products in Ghana. Prices are likely to move upwards, according to the Bank of Ghana (BoG).

“The current level of crude oil prices on the international markets may entail additional costs for crude oil importation with implications for domestic pricing of petroleum products going forward,” said the central bank at its Monetary Policy Committee (MPC) press conference December 21, 2011 in Accra.

According to the central bank, in the 11 months of 2011, the country has imported crude oil to the tune of $1.2 billion while imports of oil products were $1.4 billion, amounting to a total of $2.6 billion.

Addressing the media in Accra, governor of the central bank, Mr. Kwesi Amissah-Arthur said, “Crude oil imports amounted to $1.2 billion while imports of oil products were $1.4 billion. Import of gas through the West African Gas Pipeline was estimated at $136.9 million.”

The BoG says there has been an increased volatility in the foreign exchange market which has contributed to the weakening of consumer confidence since September 2011.

It noted that although inflation has remained relatively stable since the beginning of the year, risks to the outlook for 2012 are slightly elevated.

“While upside risks remain, the slowdown in the global economy, low foreign inflation, weak domestic business and consumer confidence as well as tight credit conditions for SMEs are expected to exert a moderating effect in the outlook,” the BoG observed.

Together with increased corporate demand for foreign exchange on account of higher imports, the Ghana cedi has come under intense pressure in the last two months, it added.

By Ekow Quandzie