Economist Professor Williams Peprah has urged the Ghanaian government to explore closer energy cooperation with Nigeria. This initiative aims to reduce Ghana’s fuel import costs and cushion consumers from rising petroleum prices. His comments come amid growing concerns over escalating fuel costs, with petrol selling at GHS 14.5 per litre and diesel nearing GHS 18.
Professor Peprah stated that Ghana should leverage regional partnerships to secure more affordable crude oil supplies. This approach would move away from relying solely on temporary interventions. Global supply disruptions and extended shipping routes, caused by geopolitical tensions, have significantly increased the cost of transporting crude oil to Africa. These higher costs directly impact fuel prices in Ghana.
This call for regional cooperation aligns with Ghana's broader economic challenges, particularly its reliance on imported petroleum products. High fuel prices contribute to inflation, affecting transport costs, food prices, and overall economic stability. The cedi's stability, despite foreign exchange market pressures, remains a key concern for policymakers as import costs rise.
“This is the time for Ghana to now talk to our brother in Nigeria to see what support they can also give to us to reduce the cost,” Professor Peprah suggested. He highlighted that even Nigeria’s Dangote refinery acknowledges the high cost of transporting crude oil across Africa. This underscores the necessity for regional governments to collaborate on logistical challenges.
The implications of securing cheaper crude are significant for Ghana's economy and its citizens. Lower fuel prices would ease the financial burden on households and businesses, potentially stimulating economic activity. Decision-makers will need to assess the feasibility and benefits of such a partnership with Nigeria. This includes evaluating supply reliability and pricing structures.
Professor Peprah also pointed to the potential role of the Tema Oil Refinery (TOR). He stated that its return to active refining could help lower petrol and diesel prices. This would require adequate investment and a consistent crude supply. A revitalized TOR could reduce Ghana's dependence on refined product imports, offering a more sustainable solution to fuel price volatility.
The government's response to these suggestions will be crucial in determining the future trajectory of fuel prices in Ghana. A reduction of even GHS 1 per litre, while seemingly small, could have a cumulative positive impact. The real solution, according to Professor Peprah, lies in establishing a supply line that enables Ghana to obtain cheaper crude oil consistently. This long-term strategy would offer more stability than short-term price interventions.