COPEC urges BoG to implement clear foreign exchange policy amidst soaring petroleum prices
The Chamber of Petroleum Consumers (COPEC) has raised concerns over the relentless surge in petroleum prices in Ghana, prompting a fervent call to the Bank of Ghana (BoG) to develop and implement a comprehensive foreign exchange policy. COPEC’s plea comes in the wake of the recent increment in petroleum prices during the second pricing window, which commenced on 1 August 2023.
As per COPEC’s Executive Secretary, Duncan Amoah, the escalated fuel prices at the pumps can be attributed to the prevailing uptrend in global oil prices. This precarious situation necessitates the BoG to formulate a robust foreign exchange strategy aimed at bolstering the national currency, the cedi, to ensure price stability in the domestic market.
Speaking in an exclusive interview with the Ghana News Agency in Accra, Mr. Amoah underscored the urgency of the situation and cautioned that the second half of the year could witness further escalations in oil prices on the global front. Consequently, COPEC insists on the imperative for the central bank to undertake prudent actions in managing the currency’s trajectory to safeguard the nation from potential adverse impacts.
On the global oil front, prices experienced limited fluctuations on Tuesday, hovering near a three-month pinnacle, driven by indications of constricting global supply as producers implement production cuts, coupled with robust demand in the United States, the world’s leading fuel consumer.
Brent crude futures for October delivery presently stand at US$85.25 a barrel, marginally down by 0.2% from its recent close, according to a report by Barrel of Oil Equivalent (BOE).
Earlier in June, OPEC reached a wide-ranging agreement to restrict oil supply through 2024, with Saudi Arabia pledging an additional voluntary output cut of one million barrels per day for July. Subsequently, the Saudi authorities announced that the cut would extend into August and may even be prolonged further.
In light of these dynamics, Mr. Amoah cautioned that should the dual factors of heightened global oil prices and currency instability persist in the second half, the ramifications on petroleum prices at the pumps could be profoundly significant, placing an unwelcome burden on consumers.
The situation at hand underscores the pressing need for the Bank of Ghana to exercise prudent monetary management and deploy targeted measures to fortify the cedi’s resilience amidst the evolving global economic landscape. As the nation grapples with the challenges posed by volatile oil markets, a clear and decisive foreign exchange policy becomes ever more indispensable to safeguard Ghana’s economic interests and foster stability in the petroleum sector.
