The Chamber of Petroleum Consumers Ghana (COEC) has asked the government to ensure that the Tema Oil Refinery (TOR) becomes very effective again by transacting business with the company.
Duncan Amoah, Executive Director of the COPEC told TV3 in an interview that when government decides to do business with TOR, the refinery will in turn, also attract deals from more oil suppliers.
“TOR and BOST may not have good financial positions or good books to attract that kind of investment the need. So if government went out there to say give us products and we will be able to pay in 90 days, I am sure a lot of the major suppliers will be willing to also do business with TOR,” he said.
He also said : “What government will also need to do is to also put in enough security to ensure that the product that they give doesn’t just get into the system and people now take advantage. Once that happens government will lose substantially.
“And so, government should put in security arrangement at the depots and ensure that we are stocking up just for tomorrow in case process begin to rebound or go up so badly, whatever profit the private market would have made government would have also been able to get some revenue to cushion its own budget.”
Mr Amoah, on Tuesday April 21 noted also that some oil producers and oil fields may be soon forced to shut down production due to lack of storage space globally, hence the need to resource the local oil refinery.
He advised the government to consider getting the local oil refinery back to productivity in order to process Ghana’s oil locally.
The COPEC Boss asked the 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 at this point for the country’s strategic reserves or stocking needs.
He noted that BOST should be able to stock enough oil as the world crude prices are dropping drastically.
Mr Amaoah said in a statement that : “We do believe this notwithstanding, however, that the markets are ripe for 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 at this point for the country’s strategic reserves or stocking needs.”
He also noted that pump prices are very unlikely to see any reductions as is being expected by a cross section of the Ghanaian public following the drop in oil prices.
Several Ghanaians expect the prices to drop at the local pumps.
But Duncan Amoah said : “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 at 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.
“The disparity in the two benchmarks is largely due to a supposed unavailability of storage space across the US market with some traders allegedly paying for cargo to be returned before the close of the futures market for the month of April on 22/04/20.
“This pricing collapse is largely reflected on crude and has very little direct impact on processed or refined products and by extension local pump prices.”