Ghana’s Petroleum Sector Faces Production Slump Amid Tax Revenue Shift and Fuel Price Volatility

Ghana’s petroleum sector is navigating a complex landscape of declining production and shifting revenue streams, according to the 2025 Annual Report by the Public Interest and Accountability Committee (PIAC). For the first time since oil production began, Corporate Income Tax (CIT) emerged as the largest contributor to the Petroleum Holding Fund, accounting for 45% of receipts at US$346.9 million. However, this milestone occurred against a backdrop of a significant 43.27% drop in total petroleum revenue compared to 2024, falling from US$1.36 billion to US$770.3 million. This decline was primarily driven by payment delays for offshore liftings caused by geopolitical sanctions and a worrying six-year downward trend in crude oil production, which has plummeted from 71.44 million barrels in 2019 to just 37.3 million barrels in 2025.

In response to the rising cost of fuel sparked by geopolitical tensions in the Middle East, the Ghanaian government has moved to remove certain taxes and margins to alleviate the financial burden on consumers. Dr. Riverson Oppong, CEO of the Chamber of Oil Marketing Companies (COMAC), has welcomed the intervention but cautioned that relief at the pump will be gradual rather than instantaneous. Dr. Oppong has also called for greater transparency regarding the 'dumsor levy' and other tax proceeds, urging the Ministry of Finance to disclose revenue figures to justify their continuation. Amidst these fluctuations, transport operators have maintained a cautious stance; Intercity STC Coaches Limited officially debunked rumors of fare increases, while the Ghana Private Road Transport Union (GPRTU) expressed support for the introduction of 100 new Metro Mass buses to ease commuter challenges.

Despite the domestic production decline, Ghana’s medium-term energy security appears stable. A report by Fitch Solutions suggests that the resumption of operations at the Tema Oil Refinery (TOR) in late 2025 will significantly reduce the nation's vulnerability to global oil market disruptions. By 2026, Ghana is expected to transition toward being oil-trade neutral or even a modest net exporter, supported by a projected current account surplus. To ensure the safety and sustainability of the downstream sector, the National Petroleum Authority (NPA) and COMAC have launched 'Safety Week 2026,' focusing on proactive risk management to prevent industrial accidents and enhance regulatory compliance.

Broader global risks continue to loom over the industry, particularly for the aviation sector. Airports Council International (ACI) Europe has warned of potential jet fuel shortages if the Strait of Hormuz remains closed, a situation that could spike prices and disrupt travel. Furthermore, the International Federation of Airline Pilots’ Associations (IFALPA) has highlighted safety concerns for pilots operating in conflict-prone regions like the Middle East. As Ghana works to revitalize its underperforming oil fields, such as the TEN field, the government faces the dual challenge of attracting new investment while managing the immediate economic impact of volatile global energy markets on its citizens.