Ghana’s 98% Fuel Import Dependence and Its Economic Impact

Ghana’s fuel industry is largely dependent on the global market, with the country importing over 98% of its fuel due to non-operational refineries, according to Nana Amoasi VIII, Executive Director of the Institute for Energy Security (IES).

In an interview on Joy News’ PM Express on Tuesday, March 18, he pointed out how global market trends influence domestic fuel prices.

“Global market events are favorable for our domestic market in terms of price,” he said. “If global prices drop, there’s a chance domestic prices will fall as well.”

However, he emphasized that Ghana’s heavy reliance on imports makes it vulnerable to international market fluctuations.

“There are several key factors we consider when predicting fuel prices in our market,” he explained. “One of the major ones is the international price of fuel, as we are heavily exposed to global events.”

He attributed Ghana’s dependency on imports to the failure of its refineries. “Our refineries are not operational, except for small ones like Akwaaba and Platon, which process less than 1,000 metric tons per day,” he said.

“Tema Oil Refinery and Sentuo Refinery are not working, so we import over 98% of our fuel.”

This reliance on imports leaves Ghana vulnerable to global market shocks, he noted. “Any change in the global market impacts us here,” he said, adding that currency exchange issues make matters worse.

“We import in dollars because the fuel and crude oil we purchase are priced in dollars, but we sell in cedis,” he explained.

He cautioned that the depreciation of the local currency worsens the situation.

“If the dollar is stronger than our local currency, we lose money when we exchange cedis for fuel imports,” he added.

His comments highlight Ghana’s fuel sector vulnerability and the urgent need to rebuild local refining capacity to reduce reliance on imports and protect the economy from global market disruptions.