Local Fuel Market Performance
Price of fuel on the local market remained stable within the window under review. Price of petroleum products within the first Pricing-window of April 2021 saw the Oil Marketing Companies (OMCs) maintain prices at the pump throughout the period. The current national average price of fuel per litre at the pump is still pegged at Gh¢5.16 for both products on the back of the stability in the prices.
For this Pricing-window, Zen Petroleum, Benab Oil, Petrosol and Frimps Oil sold the least-priced fuel on the local market according to IES Market-Scan.
World Oil Market
For the window under assessment, international benchmark, Brent crude price averaged about $63.65 per barrel mark representing a 2.40% decrease from the previous window's average price of $65.22 per barrel mark.
Source: IES Construct 2021, with data from oilprice.com
The Brent Crude price experienced the usual volatility in the markets within the period. Prices began to rise on the news of a possible prolonged delay in the reopening of the Suez Canal after it had been blocked by the Ever Given vessel. Prices however begun to decrease when the canal was freed a few days after the blockage, setting aside the projected weeks-long delay.
The OPEC+ decision to curb production cuts, on hopes of a tightening market, leading to an expected addition of 2 million barrels per day between May and July also boosted market prices as traders looked to an expected increase in demand for oil products.
The prices retreated just a few days following from that as the extended business lockdowns in the Ontario province of Canada, the largest city in India, Mumbai and the call for stricter restrictions in Tokyo, Japan threatened the demand hopes. These renewed restrictions countered the optimism for a tightening oil market.
Gasoline and Gasoil prices as monitored on Standard and Poor’s global Platts platform show that price of the international commodities Gasoline and Gasoil experienced marginal differences within the period. Gasoline saw an increase in price by 1.83% to close the window at $619.88 per metric tonne from an earlier $608.73 per metric tonne. Gasoil price however decreased by 2.65% to close trading at $499.75 per metric tonne from the earlier window's price of $513.35 per metric tonne.
Data collated by IES Economic Desk from the Foreign Exchange (Forex) market shows the Cedi depreciated marginally against the U.S. Dollar by 0.17% from the previous window's Gh¢5.73 to the current Gh¢5.74 to the US Dollar.
PROJECTIONS FOR APRIL 2021 SECOND PRICING-WINDOW
With the 2.40% decrease in price of the International Benchmark- Brent crude, the 2.65% decrease in price of Gasoil, the 1.83% increase in Gasoline price and the 0.17% depreciation of the local currency against the US Dollar; the Institute for Energy Security (IES) projects for price of gasoil (diesel) on the domestic market at the various pumps to reduce. Gasoline (petrol) prices are however expected to remain as we continue into the second half of April 2021.
With the aim of increasing market share however, the various OMCs may decide to reduce the price of both products.
Research Analyst, IES