Ghana’s Energy Sector Under Pressure: Rising Fuel Costs and Forex Volatility Strain Economy

Ghana is bracing for a significant surge in petroleum prices starting May 16, 2026, as the country’s energy sector grapples with the combined effects of global market instability and local currency depreciation. Projections from the Chamber of Oil Marketing Companies indicate that petrol prices are expected to rise by up to 7.30%, reaching approximately GHC 15.42 per litre, while diesel may climb to GHC 17.83 per litre. These increases are primarily attributed to the Ghanaian Cedi’s 0.95% dip against the US dollar and persistent geopolitical tensions affecting global shipments, despite a slight decrease in average international crude prices.

In response to these market pressures, the National Petroleum Authority (NPA) has adjusted its ex-pump price floors for the second pricing window of May, setting the minimum benchmark for petrol at GHC 14.60 and diesel at GHC 15.81. While the government has pledged to continue intervention measures—including temporarily absorbing some fuel costs—industry experts warn that these efforts may only partially mitigate the burden on consumers. Parallel to these fiscal adjustments, the NPA has intensified its enforcement efforts; recently, in collaboration with the Ghana Navy, officials destroyed eight large canoes involved in smuggling 5,800 litres of fuel at the Sekondi Naval Base to deter illegal bunkering and ensure product quality.

The volatility of the foreign exchange market is also placing a severe strain on the Electricity Company of Ghana (ECG). Former Managing Director Samuel Dubik Mahama recently identified forex fluctuations as the primary hurdle for the power distributor’s financial stability. Because ECG purchases power from producers in foreign currency but generates revenue in Cedis, the company remains highly vulnerable to exchange rate risks. Mahama noted that while recent windows of forex stability have improved financial forecasting, the sector requires consistent currency performance to maintain sustainable growth and support ongoing infrastructure reforms.

Amid these financial challenges, ECG continues to manage critical infrastructure maintenance. The company has scheduled a planned power outage for the Tema Region on May 17, 2026, to conduct essential repairs, following recent underground cable faults that disrupted service in the Western Region. As the government and energy providers navigate these operational and economic headwinds, the Chamber of Petroleum Consumers (COPEC) continues to advocate for extended tax relief to protect the public from the cascading effects of energy inflation.