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Tuesday, October 20, 2009

Fuel Shortage and Price Increase to Hit Ghana

Government recently held a major conference and promised that its first crude oil consignment from Nigeria would arrive on Wednesday, October 7. 750,000 barrels of crude oil was the amount expected.

But, the Statesman can report that the chattered vessel sent to Nigeria to lift the crude oil left Nigerian waters empty last Thursday for Ghana. It arrived in Tema empty after being chased out of Nigerian territorial waters by the Nigerian Navy according to our sources in Nigeria.

The reason a Nigerian Navy source gave was that the ship had no legal order to load in the West African country. An earlier report that reached The Statesman indicated that while the vessel docked in Nigeria for weeks waiting to lift the supposedly clinched crude consignment to Ghana, it was incurring port charges and bunkering/operational costs, etc.

It is estimated that this whole futile adventure has cost the people of Ghana some $1,000,000 for both chatter cost and waiting charges at the Nigerian port. The Nigerians, like the Indian government, are very unhappy with the Ghanaian government.

The Mills administration, which has a manifesto pledge to stop Nigerian company Sahara Oil from lifting crude to Ghana has stubbornly refused to rescind on that decision while expecting Nigeria to be sympathetic to its oil woes, even though Ghana had reneged on earlier oil deals with its neighbour.

President Mills recently went to Venezuela, after the UN General Assembly ostensibly to look for alternative supply sources. But, sources say nothing was achieved there since the government went there with no programme of clarity. Promises of crude oil from Libya too have turned out to be empty barrels.

As a result of the Mills administration’s inability to import crude oil from Nigeria, Ghana will be hit by fuel shortages within the next ten (10) days and the phenomenon of people moving with a “gallon in hand” not in search of water but for petroleum products will be vivid once again, coupled with heavy vehicular queues in most fuel stations. Not only will the shortage of petroleum products be the burden on the ordinary Ghanaian, but prices of petroleum products will also be increased this week.

One of the conditionalities imposed by the World Bank for the release of the second tranche of $150 million to Ghana was the removal of subsidies on petroleum products. The second tranche is to be released to Ghana this month (October), thus the above stated conditionality must be achieved for government to access the money. World crude oil price has also seen an increment; currently selling at $78.67 per barrel.

In June this year when crude oil prices were at $64 per barrel, fuel prices were increased for the second time. Petrol now sells at GH¢1.11 per liter, representing approximately GH¢5.00 per gallon while diesel is going for GH¢1.12 per liter, representing GH¢5.04 per gallon. A gallon of petrol used to go for GH¢3.80 whilst diesel was selling at GH¢4.00 per gallon.

Kerosene which used to sell at 66.50Gp per liter, is now going for 86.45Gp per liter, representing GH¢3.90 per gallon while premix fuel is going for 51.48Gp per liter from the previous 39.60Gp per liter. Price of LPG also shot up from 61.40Gp to 79.00Gp per kilo.

With crude oil now selling at $78.67 dollars a barrel, the price of petrol is expected to be sold at GH¢5.80 (16% increase). Diesel will sell at GH¢ 6.00, representing a 19% rise whilst kerosene will also go for GH¢ 4.60, an 18% increase.

Source: The Statesman

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