Why is Ghana Facing a Crude Crisis?

Despite its best efforts, experts warn that Ghana is on the verge of a petroleum crisis. Why? Thanks to a flourishing black market, the nation’s ‘above board’ oil economy could be about to collapse. In a bid to save its fragile economy, the Association of Oil Marketing Companies (AOMCs) has stepped in and called on the government to take a cut-throat approach to managing the situation.

The rise of ‘dirty’ oil

“Given the gravity of Petroleum Black Market dealers, we members of the AOMCs give the government 48 hours to bring this menace to an end,” demanded AOMCs Industry Coordinator, Kwaku Agyemang-Duah.

“AOMCs firmly believe that the government has the requisite authority, tools, instruments and relevant resources such as security institutions to stamp out this menace within 48 hours,” he stressed. Furthermore, he accused the government of knowing what groups are behind the illegal oil, and urged them to “act without fear or ill-will.”

Starting in early 2016, Ghana’s illegal petroleum economy began as a relatively under the radar market. While it did gain momentum in mid-2016, it seemed to fizzle out after the national elections. Though despite the cool off period, 2018 brought a new wave of illegal oil. Now, Agyemang-Duah warns that the black market has been resurrected “beyond comparable measure.”   

Mismatched figures

The latest figures support Agyemang-Duah’s claims, with the total national petroleum consumption for 2015 sitting at around 4,300,000,000 litres. Based on this data, projected sales of petroleum products for 2016 should have hit over 4,400,000,000 litres. But despite a rise in demand, official figures indicate that consumption dropped to just over 4,000,000,000. In effect, a significant slice wasn’t sold via official channels. As a result, Agyemang-Duah maintains that both the government and the people of Ghana are losing out.

Black market spurs big loses 

“Ghana lost huge sums of money in terms of tax revenue as per official petroleum tax - Special Petroleum Tax GHC 132 million was lost to the nation; Energy Debt Recovery Levy about GHC123 million; and the Road Fund levy about GHC 120 million,” claims Agyemang-Duah.

With the black market threatening sales, efficiency has become a top priority for oil producers across the globe. Refiners are also affected, and are continually on the search for new ways to increase efficiency, and minimise costs. For a closer look at how this is being achieved, ‘Making Elemental Analysis of Petrochemicals as Easy as 1-2-3’ explores how S8 TIGER technology is helping to improve analytical performance, boost efficiency and minimise cost of ownership.