Pump prices of fuel have shot up 288 percent since January 2017 to date, according to data from the energy think-tank Institute of Energy Security (IES).
In January 2017, a litre of petrol and diesel sold at GH¢3.65 and GH¢3.63 respectively, but now sells at GH¢11.32 and GH¢14.05 respectively, with 2021 and this year witnessing the biggest jumps.
With the exception of 2020, when a litre of fuel ended the year lower than it began – from GH¢5.36 in January to GH¢4.79 in December, prices have consistently risen above 20 percent.
In 2021 and the first six and half months of this year, for instance, pump prices went up 36 percent from GH¢4.79 in January to GH¢6.70 in December and 110 percent from GH¢6.70 to GH¢14 respectively, with government sources blaming it on the Russian-Ukraine conflict.
At the beginning of this year, a litre of diesel which sold at GH¢6.70 now goes for GH¢14, with many fearing that the worst is yet to come, given the deteriorating economic situation in the country and happenings on the international stage.
While the war in Eastern Europe might have impacted prices across the world, with Ghana, not an exception, most industry watchers hold the view that the depreciation of the cedi – which has lost about 30 percent of its value this year – is a much bigger problem.
“The most key cost issue is the slide of the cedi,” says Dr. Sam Ankrah, a fellow of Chartered Institute of Economists – Ghana and an investment banker; adding: “it’s been shown that the cedi has depreciated by 30 percent.”
Similarly, IES had earlier warned in the first quarter of this year that the free-fall of the cedi against the US dollar would continue to drive fuel prices up if nothing was done to stabilise the local currency.
The astronomical rise in fuel prices, coupled with inflation at 30 percent, has deepened the economic plight of most Ghanaians, especially the poor, as prices of food items – mainly influenced by rising transport fares – continue to skyrocket.
A truck driver who sells clean water to households and property developers around Teiman and Abokobi in the Ga East Municipality of Accra said that of the GH¢600 he got as sales the previous day, GH¢350 went into fuel alone.
With fuel prices and the cost of living rising to levels not seen since Ghana’s economic crisis of the early 80s, many public worker unions, including teachers and nurses, have been protesting for improved working conditions to cope with the rising inflation.