Consumers should be paying more for fuel they purchase at the various pumps from Tuesday, September 19, 2017 as Oil Marketing Companies (OMCs) begin to adjust their prices to reflect the increase in the prices of their products.
If the prediction by the Institute of Energy Security (IES) is anything to by, then prices will go up by at least 7 percent for the second pricing window in September.
Citi Business News’ checks indicate that the prices of petroleum products are increasing marginally from August till present.
This has been triggered by the marginal depreciation of the cedi as well as increased global crude oil prices due to the recent floods in the US which affected production at major oil companies.
The Principal Research Analyst at the Institute of Energy Security, Richmond Rockson explained the phenomenon.
“We are expecting prices to rise between seven and ten percent and this will have an impact on consumers. This probably will be the most significant. The cedi also keeps depreciating. After the storm Harvey, refineries were affected so prices will definitely go up”.
Petroleum prices increase by 3 percent on the average
An analysis of the first seven months of 2017 shows that the prices of petroleum products have gone up five times out of the fourteen pricing windows in the period.
The year started with perhaps the highest percentage rise in prices of petroleum products.
The prices of petrol and diesel went up by as much as 7.73% and 6.68% respectively.
This continued until March 15th, when the prices started to drop marginally.
Although the year begun with a litre of petrol and diesel selling at 4 cedis 4 pesewas and 3 cedis 99 pesewas respectively, as at the middle of March, the price for the same quantity each of petrol and diesel had gone up to 4 cedis 30 pesewas and 4 cedis 25 pesewas respectively.
In all, the first four months of 2017 witnessed an average increase in prices of 3 percent.
At the time, industry watchers attributed the development to the decision by oil producing countries to hold back production in January in order to recoup some of their recent losses.
In addition was the cedi’s depreciation against the dollar coupled with drop in combined stock of Gasoline and Gasoil from about 130 to 120 thousand metric tonnes.
Declining petroleum price margins for 2017
Meanwhile the prices of petroleum products began declining from the second pricing window in March which spanned 16th to 31st March 2017.
Of the nine times that petroleum prices have been declining, the highest rate of decline in petroleum prices has been in the second pricing window in March where prices dropped by almost 4 percent .
But prices of diesel recorded the highest decline of about 3 percent in the subsequent pricing window spanning 1st to 15th April, 2017.
In each of these cases, the drop in the global oil prices due to a rise in U.S. shale production as well as the relative stability of the cedi accounted for the drop.
On the average, prices have dropped by 1.46 percent between January and July 2017.