The African Center for Energy Policy (ACEP) has debunked Dr Bawumia’s Assertions that the Gold-for-Oil policy is responsible for the recent drop in prices of fuel at the pump.
Benjamin Boakye, ACEP Executive Director, in response to the Vice President, believes the government should not take credit for the reduction in fuel prices. He thus, insisted that the recent drop in fuel prices is due to a global drop in crude oil prices.
“If you are really analysing how the pricing mechanics work, you would note that it has nothing to do with gold for oil policy. We are seeing prices on the international market drop. Indications are that, it is even going to drop further.”
Benjamin Boakye
In the intervening time, the Ranking Member of Parliament’s Mines and Energy Committee, John Jinapor, also concurred with the ACEP Boss noting that the Vice President’s claim that the Gold for Oil Policy is to praise for the recent drop in fuel prices is false. The Yapei-Kusawgu legislator also agreed that the decline is due to a drop in global market prices.
“The Vice President is not being honest. In January, crude oil price on the international market US$97 and $92 per barrel after dropping from about US$100. Now, it is about US$ 72 per barrel. So, if you have crude oil prices falling, you can’t attribute it to your gold for oil.”
John Jinapor
IES Predicts Fuel Prices to Start Dropping from Today
Meanwhile, the Institute for Energy Security (IES) predicted fuel prices to further start dropping from today, 16th March, 2023. According to IES, petrol and diesel will drop between 3% and 10% at the pumps.
The last two weeks has seen price indicators on both the domestic and international fronts falling and this can translate into some price reductions at the pumps for various petroleum products. The domestic fuel market prices are projected to fall.
The international crude oil benchmark Brent fell to about $83.87 from about $84.14 per barrel over the last two weeks, representing a marginal drop in the average prices in the window under review. The commodity which traded at about $86 per barrel in the mid of the window declined to as low as $79 per barrel at the start of Tuesday 14th March, 2023.
The Global Standard & Poor (S&P) Platts price averages monitored during the first pricing-window of March 2023 show the prices of Gasoline, Gas Oil, and LPG at about, $793.75, $812.85, and $625.25 per metric tonne respectively. This is a significant decline from the previous window prices for all petroleum products. Gasoline price dropped at about -4.53%, Gas Oil, -2.06%, and LPG -8.98% a further decrease in price of Gasoil and Gasoline, whereas an increase in the price of LPG.
However, at the commissioning of a new office complex for BOST, Vice President Dr. Mahamudu Bawumia, alluded to the fact that the Gold for Oil policy has resulted in significant price reductions at the pump, much to the relief of motorists. He moreover, announced that consumers of petroleum products can expect further reductions in fuel prices at the pump as a result of the implementation of the Gold for Oil Policy.
That notwithstanding, the Vice President was quick to add that the the most important aspect of Gold-for-Oil policy is not the reduction in fuel prices, but the savings Bank of Ghana (BoG) will make in foreign exchange.
“The most important aspect of the gold-for-oil policy is not just the reduction in fuel prices, but the most important aspect is the savings in foreign exchange that the Bank of Ghana will make as a result of the lower demand for forex to import oil. That saving is huge,” the Veep said.
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