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IES – Fuel Prices To Shoot Up Again

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The Institute for Energy Studies (IES) is predicting a hike in fuel prices this month.

“Guided by the fundamental indicators such as rise in price of Gasoline, Gasoil and Brent crude on the international oil market, the country’s fuel stock as well as the fair-stability of the country’s local currency against the U.S. Dollar; the Institute for Energy Security (IES) sees fuel prices primed to rise again on the local market by up to 2.5%,” said the Energy think-tank in its review of April 2018 First pricing-window.

“This imminent price increase may be averted by an intervention from the National Petroleum Authority (NPA) if it decides to trigger the Price Stabilization mechanism in the second Pricing-window for April 2018,” it added.

Below is the full statement

FUEL PRICES TO SHOOT UP AGAIN

REVIEW OF APRIL 2018 FIRST PRICING-WINDOW

Local Fuel Market Performance

Over the last two weeks, consumers of fuel have had to pay more for petroleum products purchased at the pump. As projected by the institute, all Oil Marketing Companies (OMCs) increased prices of Gasoline and Gasoil at an average of 2%. The national average selling price of a litre of Gasoline and Gasoline currently stands at Ghs 4.57 and Ghs 4.56 respectively.

IES-Market scan indicates Zen Petroleum, Benab Oil, Pacific, Lucky Oil and Frimps Oil lead the chart of Oil Marketing Companies (OMCs) selling the cheapest fuel per litre at the pump.

World Oil Market Prices

Within the period under review, Brent crude closed trading at $68.96 per barrel from a previous average of $66.85, representing 3.16%. And Brent is in position to post extra gains within the next two weeks due to shrinking global oil inventories and concerns over the escalating military activities in the Middle East. As at today Brent crude is trading around $72.00 per barrel mark, one of the highest averages in recent times.

According to Standard and Poor’s Global Platts benchmark for Gasoline and Gasoil, prices of both products recorded increments on the international fuel market. Gasoline closed trading at $681.80 per metric tonne from a previous average of $645.77, a change of 5.58%. Gasoil also saw a price change of 4.90%, from a previous average of $587.73 per metric tonne to close at $616.53 per metric tonne.

Local Forex and Fuel Stock

Data recorded from the foreign exchange market by IES Economic Unit suggests a fairly stable local currency, as the Ghana Cedi closed trading at Ghs 4.55 to a U.S. Dollar, with a depreciation of 0.89%.

From April 1, 2018 to date, total petroleum imports recorded stands at 225,886 metric tonne; 98,220 metric tonnes of Gasoline, 120,516 metric tonnes of Gasoil and 7,150 metric tonnes of Butane were imported into the country.

PROJECTIONS FOR APRIL 2018 SECOND PRICING-WINDOW

Guided by the fundamental indicators such as rise in price of Gasoline, Gasoil and Brent crude on the international oil market, the country’s fuel stock as well as the fair-stability of the country’s local currency against the U.S. Dollar; the Institute for Energy Security (IES) sees fuel prices primed to rise again on the local market by up to 2.5%. This imminent price increase may be averted by an intervention from the National Petroleum Authority (NPA) if it decides to trigger the Price Stabilization mechanism in the second Pricing-window for April 2018.

Signed: RICHMOND ROCKSON

(Principal Research Analyst, IES)

 

Source: Starrfmonline.com

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Business

Our Fuel Is Safe – Radiance Petroleum

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The management of indigenous oil marketing company (OMC), Radiance Petroleum Limited, (RPL) has dispelled claims that its Kasoa Nyanyano branch has sold unclean fuel to some taxi drivers.

Nonetheless, the management of the company has launched investigations into the matter. It has taken samples of the product and reported the case to its Bulk Distribution Company and the National Petroleum Authority (NPA).

It has also intensified its security, monitoring and surveillance at all its 37 branches across the country to offer the best of services to customers.

“We are committed to our mission, which is: to provide the best fuel to our customers in ways that are compliant, profitable, reliable, safe and socially responsible. Customer service is paramount to our operation – nothing is more important to us than a satisfied customer – and we will go all length to ensure we are selling the right products and giving the right service to all who patronize our stations,” the General Manager of the company, Joseph Addae, said.

“Even though this is a complaint at only one of our stations, we have taken precautionary measures to ensure all our station never record such complaints.”

The company has been in existence for five years and is recording such a complaint for the first time. Since the inception of the deregulation exercise, Radiance Petroleum is among OMCs selling the cheapest and safest fuel in Ghana.

Radiance Petroleum Ltd. (RPL) is a limited liability company incorporated under the Companies Code of 1963 (Act 179).RPL is to leverage the expertise acquired in the sector in the last five years to position itself well to deliver excellent customer service.

The company, which has been operating in the downstream petroleum sector since March 2013, said customers should expect enhanced service delivery in line with safety.

The Managing Director of the Company, Emmanuel Pobee, explained that the first five years of operations have been a learning curve for the company to understand the business, its customers and what pertains in the industry.

“I will not say the first five years have been easy but I believe it has helped us learn a lot to help us improve going forward,” he said.

Radiance Petroleum Limited is a limited liability company incorporated in October 2012. The company loaded its first product on March 15, 2013. It currently operates in six regions and 37 service stations.

 

Source: Starrfmonline.com

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ECG: Meralco Selection Not Competitive – PUWU

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The Public Utilities Workers Union (PUWU) is questioning the competitiveness of the bidding process leading to the selection Meralco Consortium to manage the Electricity Company of Ghana (ECG).

According to him, it there was no iota of competitiveness in the selection of Meralco Consortium.

Meralco Consortium, according to a statement by the Millennium Development Authority (MiDA), “was determined to have the highest combined technical and financial score and has therefore been designated as the Preferred Bidder.”

Led by the Manila Electricity Company, Meralco Consortium, is an incorporated company in the Philippines, operating over the last 115 years.

“Its electricity distribution network covers a third of the Philippines and serves a customer population (Accounts) in excess of six million,” the MiDA statement signed by Director of Communication and Outreach Pamela Djamson-Tettey noted.

Commenting on the announcement by MiDA, the General Secretary of PUWU, Michael Adumattah Nyantekyi raised concerns over the competitiveness of the bidding process that led to the selection of Meralco Consortium.

Ahead of the announcement, CH Group pulled out of the bidding process leaving BXC Company Limited and Meralco Consortium.

Per the compact, the Millennium Challenge Corporation is expected to inject about $418 million into ECG, while Meralco will invest about $500 million.

“…By this announcement are they telling Ghanaians that this process has been very competitive? Because we know at a point it was left with only two bidders and if you are going through a process like this, you started with eleven companies, nine dropped out, living only two and you still go ahead and say you have selected one,” said Adumattah-Nyantekyi in a Starr News interview.

“Would you describe this as competitive process? Yes, you may have ended with one but then the big question is how competitive is the process?” he added.

MiDA, according to the statement by the Director of Communication and Outreach, will soon start finalizing the agreements related to the implementation of the ECG PSP Transaction.

 

Source: Starrfmonline.com

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Business

Ghana, Nigeria Most Attractive Bond Markets – Research

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Ghana and Nigeria have been ranked as the most attractive Local and Euro Bond Markets on the continent, according to a new research carried out by South African-based Rand Merchant Bank.

The Research comes in the wake of the recent ranking of Ghana’s economy as the second fastest growing economy on the continent.

Finance Minister Ken Ofori Atta last week revealed the prospect of issuing a Samurai Bond is bright after leading a high powered government delegation to a Non-Deal roadshow in Japan.

Senior Global Market Researcher at the Rand Merchant Bank Celeste Fauconnier believes Ghana must continue with its fiscal consolidation measures in order to sustain investor confidence.

“If they had a portfolio that says you must invest anywhere in the world, Africa would have felt the pinch,” she said, wondering why would one want to be in Africa which is more risky than going into the US and European bonds.

The US and European bond markets, she said have dedicated African Funds and Ghana and Nigeria are benefiting from it because “they are the most attractive local bond market and Eurobond markets in our portfolio of countries.”

Zambia, she said used to be the most attractive bond market for investors but “unfortunately Zambia is shooting itself in its foot because, it is signing an IMF agreement.”

“We have actually seen London investors moving their investments into bonds from Zambia into Ghana. So Ghana has been benefiting,” she stated.

She thus urged the government of Ghana to continue its fiscal consolidation policy, warning that “any fear will move investors in the local bond market here [Ghana] to the Nigerian bond market.”

Earlier this year, the World Bank said Ghana’s macroeconomic outlook was largely positive based on the 2017 performance, with  GDP growth for 2017  estimated to have almost doubled from the 3.7 percent in 2016, and is expected to stay at that elevated level through 2018.

Also the external position, it said has improved as the trade balance has shifted to a surplus, but it needs to sustain the fiscal consolidation efforts.

 

Source: Starrfmonline.co

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