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Starting Monday, June 16, 2025, fuel prices in Ghana are set to decrease, offering relief to consumers amid ongoing economic challenges. This marks the seventh reduction since February 16, 2025, and is attributed to various factors, including the postponement of the GH¢1.0 Energy Sector Levy and the appreciation of the Ghanaian cedi. Projected Fuel Price Reductions
According to the Chamber of Oil Marketing Companies (COMAC), the upcoming pricing window from June 16 to June 30, 2025, is expected to see:
Petrol: A decrease to GH¢11.77 per litre, reflecting a reduction of between 1.1% and 2.25% from the June 1, 2025 price.
Diesel: A significant drop to GH¢12.13 per litre, marking a decrease of up to 4.3%.
Liquefied Petroleum Gas (LPG): A reduction to GH¢13.30 per kilogramme, representing a 3.2% decline.
These adjustments are part of Ghana's bi-monthly fuel pricing mechanism, which considers factors such as international crude oil prices, exchange rates, and import costs.
Factors Influencing Price Reductions
1. Postponement of the GH¢1.0 Energy Sector Levy
The government's decision to delay the implementation of the GH¢1.0 levy has prevented an anticipated increase in fuel prices. Had the levy been applied, petrol prices could have risen by approximately 9.1%, diesel by 8.25%, and LPG would have seen a modest decrease of 2.29%.
2. Appreciation of the Ghanaian Cedi
The Ghanaian cedi has strengthened against the US dollar, reducing the cost of importing petroleum products. This appreciation has been supported by factors such as improved foreign exchange reserves, fiscal discipline, and investor confidence. As a result, oil marketing companies have been able to lower prices at the pump.
3. Decline in Global Crude Oil PricesInternational crude oil prices have decreased, with Brent crude falling from around $85 per barrel in January to approximately $64. This decline has contributed to lower import costs for petroleum products. However, the impact of this reduction has been somewhat offset by the appreciation of the cedi.
Implications for Consumers and the Economy
1. Reduced Transportation Costs
Lower fuel prices are expected to lead to decreased transportation costs, benefiting both consumers and businesses. This reduction can contribute to overall economic stability and ease the financial burden on households.
2. Easing of Inflationary Pressures
The decrease in fuel prices is anticipated to contribute to a slowdown in inflation. In May 2025, Ghana's consumer inflation rate decreased to 18.4% year-on-year, the lowest level since February 2022. This trend is expected to continue if fuel prices remain stable.
3. Enhanced Economic Confidence
The combination of stable fuel prices, a stronger cedi, and declining inflation can enhance investor confidence and stimulate economic growth. This positive outlook is crucial for Ghana's recovery from previous economic challenges.
Potential Risks AheadDespite the current positive trends, several factors could reverse the gains:
Volatility in Global Crude Oil Prices: Any unexpected increases in international oil prices could lead to higher fuel costs.
Exchange Rate Fluctuations: Instability in the cedi's value could negate the benefits of its current strength.
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Policy Changes: Reintroduction of the Energy Sector Levy or other fiscal measures could increase fuel prices.
COMAC has indicated that if current trends in crude oil prices persist, consumers may face higher fuel prices starting July 1, 2025.
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