The Chamber of Petroleum Consumers is urging the Ghana government to consider helping the Bulk Oil Storage and Transportation ( BOST ) to get a good credit line or an open credit system in place immediately, to stock oil for the country’s strategic reserves or stocking needs.
This follows the plunge in the price of oil below zero for the first time in an unprecedented wipeout.
The price on the futures contract for West Texas crude that is due to expire Tuesday fell into negative territory – minus $37.63 a barrel.
According to COPEC, the government should also consider getting the local refinery (Tema Oil Refinery) back to track in order to process Ghana’s oil locally.
COPEC said some of Ghana’s producers or oil fields may soon be forced to shut down production due to the lack of storage space globally.
“Whatever security guarantees or arrangements that need to be put in place to forestall any games with the strategic reserves must certainly be robust and efficient so the country does not lose on both the upstream and downstream ends due to the low prices being recorded on the international market currently”, it explained.
“Yes, it is, indeed, true that oil prices especially, the WTI platform, is currently trading at -$15, which is about the lowest in several decades.
“Brent, however, is still trading around $26 as of the close of day, and, as such, pump prices are very unlikely to see any reductions as is being expected by a cross-section of the Ghanaian public.”
COPEC added that the pricing collapse is largely reflected on crude and has a very little direct impact on processed or refined products and, by extension, local pump prices.
Moreover, the Ghanaian market is largely Brent benchmark-dependent and, as such, a collapse of WTI is quite unlikely to have any trickle-down effect on local pump prices here.