Economist, Dr. Theo Acheampong, has projected that the price of fuel at the pumps may fall in the next pricing window should the price of crude oil on the global market remain stable.

However, this may only be realized should the cedi also stabilize or preferably appreciate against the dollar.

Speaking on JoyNews’ PM Express, he explained that currently in Ghana the key price drivers for the cost of fuel are the international pricing of oil and the cedis free fall against the dollar.

Thus, should the price of oil stabilize on the global market for a couple of weeks as the country nears the next pricing window, and the cedi’s foreign exchange performance is stabilized, it could result in the reduction of fuel prices at the pump.

“My expectation is that within the next pricing window, if prices stay where they are then we should see some sort of reduction of what we’re paying at the pump but the caveat to that is assuming that you don’t have further decrement on the exchange rate side of things so Alex did indicate two factors which are really important.

“It’s the price that you buy for the product on the international market; we don’t control that price so whatever the market sets that’s what we take and subsequently, the exchange rate because we are buying it in dollars and you have to sell it locally in cedis. If you look at between the two of them, my own numbers similar to Alex’s we’re talking collectively about 50% of the price drivers coming from these two single factors,” he said.

He added that “So if we see the price reduction on the market currently as we’re seeing being sustained over the next couple of weeks then during the next pricing window my expectation is that prices will come down at the pump. But the only caveat to that is that the exchange rate doesn’t depreciate further against the cedi because that’s also one of the big big factors in all of this equation.

“We started the year with the cedi trading around 6.15 cedis to the dollar, now we’re talking 7.63 so almost an appreciation of the dollar of about 25% and that would have to be reflected in the pricing equation and the pricing dynamics.”

Meanwhile, Dr. Acheampong has also called for the scrapping and rationalization of some taxes imposed on petroleum products in the country.

This he said will go a long way to provide some reprieve to consumers who have had to suffer price hikes.

“I think we can look at some taxes that government also impose on these products which can be up to about half of the cost of the product itself and I think there are a few of them that can be scrapped and rationalized,” he said.