The Chamber of Petroleum Consumers (COPEC) has issued a cautionary statement, indicating that fuel prices are expected to continue surging in the upcoming weeks if the ongoing depreciation of the Ghanaian Cedi against the US Dollar is not addressed promptly.
Attributing recent marginal increments in fuel prices to the depreciation of the local currency, COPEC Executive Secretary Mr Duncan Amoah emphasized the urgent need for measures to stabilize the Cedi and prevent further fuel price hikes.
According to COPEC, if the depreciation trend persists, consumers are likely to face additional price increases at the pumps in the near future.
The warning comes after consecutive fuel price increments in the February and March 2024 pricing windows. Petrol, diesel, and liquefied petroleum gas (LPG) saw slight price hikes during these periods, with the Institute of Energy Security (IES) linking the increments to the Cedi's depreciation against the Dollar.
While acknowledging the Government's gold for oil program aimed at reducing the demand for US Dollars in petroleum imports, COPEC expressed concerns about its sustainability, noting that it only covered a small portion of total consumption.
COPEC suggested that utilizing the country's gold reserves to stabilize the Cedi would be a more sustainable option than the current exchange of gold for petroleum products on the international market.
The Government introduced the Gold for Oil Policy in November 2022 to mitigate the demand for dollars in petroleum imports, aiming to alleviate the depreciation of the Cedi. However, COPEC argues that more comprehensive measures are needed to address the forex factor influencing fuel prices.
With the ongoing challenges in the petroleum sector and the Cedi's depreciation, consumers are advised to brace themselves for potential further increases in fuel prices unless decisive action is taken to stabilize the currency.