Cedi depreciation causes fuel price hike for second time in March

Some major Oil Marketing Companies (OMCs) have slightly adjusted upward prices of petrol and diesel.

Checks at various fuel stations showed that Shell and Total have increased the prices of petrol and diesel by six pesewas.

The two companies are selling a litre of petrol and diesel for GHS5.24 representing a 1.16 percent increase from the previous price of GHS5.18.

This is the second increase in the prices of fuel in the month of March.

The Institute of Energy Security (IES) which predicted the increase has attributed the hikes to the recent depreciation of the cedi.

“Even though we have seen the currency pick up some strength against the dollar this came a little too late and way into the pricing window after BDCs and oil marketing companies have transacted their bills in the movement of products,” Mikdad Mohammed a Research Analyst at the IES told Citi Business News in an interview.

The first increment, which occurred after the first pricing window in the first week of March was also attributed to the depreciation of the cedi and the increase in the cost of Brent Crude on the  World market.

“We have been monitoring the market since the first pricing window in March which we projected that prices were picking up based on the cedi fundamentals of the market as we know them to be. We looked at Brent crude price, finished product price, the cedi depreciation against the dollar and we looked at the stock level,” said Mikdad.

However a major state oil company, GOIL is yet to adjust its price.

OMCs like Allied and Glory Oil are also yet to increase their prices.

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Source: citibusinessnews