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Ghana is facing a potential fuel crisis due to shortage of the United States dollars. This is worsened by the fact that Ghana does not refine crude. That country’s fuel imports have jumped from $250 million in January to $450 million in May, nearly doubling.

Ghana is rationing dollars to the import market after oil prices surged following Russia’s invasion of Ukraine and US led sanctions that seek to limit Russia’s oil exports. Bloomberg reports today that the central bank is only offering $100 million a month which alone is not enough and the situation is made dire by forex demands from other sectors namely food and machinery imports.

Ghana’s reserves is already depleting according to latest reports, down from $9.7 billion in December 2021 to $8.34 billion at the end of April as fuel price increases and adds pressure on external reserves.

A finance ministry spokesman said the issue was not fuel scarcity but foreign exchange availability which the Ghana economy has been struggling to attract owing to rising costs in every sector. “While the world market price for fuel is intolerable, the commodity is available in the market. Buying it in dollars is our problem”.

In Sierra Leone, another West African country, its problem with fuel is both inflationary and availability. Just 2 weeks ago, the government increased the pump price for fuel from $1.25 to $1.67 and reliable sources tell this medium that there’s going to be another upward price adjustment due to inflation.

Brent crude oil dropped yesterday for the first time since February by 5%