The CEO of the Chamber of Bulk Oil Distributors Senyo Hosi is billed to speak at The Alm Africa Dialogue slated for the 21st of January 2020 at the Royal Geographical Society in London. The President of Uganda Yoweri Museveni is headlining the event as the Keynote speaker.
The theme for the event is, “Harnessing Africa’s Global Economic Appeal”.
Mr. Hosi will be participating in a panel discussion with other renowned speakers such as the Chief Executive Officer of SEAGAL Group (Liberia) Momo Cyrus, Nirmala Rewa from the Economic Development Board of Mauritius and the Former UK Foreign Office and Cabinet Minister Rt. Hon. Jim Murphy.
The CEO of the African Leadership Magazine, organizers of the event, Dr. Ken Giaimi says the dialogue will bring business and industry leaders, policymakers and CEOs onto one platform to discuss how Africa should position itself as the continent engages with the rest of the world.
The event is expected to conclude with an awards session.
Senyo Hosi who is a past honoree of the prestigious African Leadership Awards will be inducted into the African Leadership Hall of Fame.

The Ministry of Energy has announced that the West African Gas Pipeline Company Limited (WAPCo), which operates the West African Gas Pipeline (WAGP), will today shut down its offshore pipeline from Nigeria to Ghana for two months.

The shutdown is to make way for a clean-up and inspection exercise of the offshore pipeline between the two countries.

The exercise is often referred to as “pigging” in the pipeline industry and the process along the West African shoreline is expected to be completed by March 21.

Statement
The Head of Communications and Public Affairs of the Ministry of Energy, Nana Kofi Oppong-Damoah, in a statement to the media, said the exercise was expected to temporarily limit the availability of gas at the Tema, Lome and Cotonou offtake facilities.

The statement said there was likely to be limited gas supply for power generation to plants in Tema during the period.

The ministry explained, however, that it was collaborating with the Ministry of Finance and other key players in the Ghana’s gas-to-power sector to make provision to mitigate the impact on the country’s grid system and ensure reliable and stable power supply.

Exercise
According to the ministry, the pigging exercise is part of a customary maintenance activity intended to protect the integrity of WAPCo’s offshore pipeline and ensure safe operations.

The activity is also consistent with regulatory requirements which is important for maintaining the pipeline to ensure efficient and reliable operations.

The ministry further explained that the offshore pipeline, which transported natural gas within the four West African States of Nigeria, Benin, Togo and Ghana, was the main critical asset of the company.

“In addition to cleaning the pipeline of debris, pigging will provide critical information on the condition of the pipeline and improve decisions on effective maintenance of the channel, prolong its lifespan and improve the safety of the pipeline operations,” the statement said.

—graphic.com.gh

Prices of fuel have seen a slight increment of about 9 Ghana Pesewas at the various fuel stations.

The increase in price has been met with mixed reactions from some commercial drivers as they lamented that the high price of the commodity is unbearable.

While some were ready to pass the burden to the consumer, others said they will still charge old prices.

The rise in price took into consideration the two percent increment in prices of crude oil, coupled with the 0.95% and 1.01% marginal increment in the prices of Gasoil and Gasoline respectively on the International market.

The Institute for Energy Security (IES) had earlier predicted that the prices of fuel on the local market may lose stability.

The Institute for Energy Security (IES) earlier this week predicted that oil marketing companies are likely to increase the prices of petroleum products to make up for the marginal price movement of crude oil on the international market.

“Taking into consideration the two percent increment in prices of Crude, coupled with the 0.95 percent and 1.01 percent marginal increment in the prices of Gasoil and Gasoline respectively on the international market; the Institute foresees prices of fuel on the local market losing stability,” the energy policy think tank said in a press statement.

Currently, the national average price of fuel per litre at the pumps is still pegged at GH¢5.36 for both petrol and diesel after a scheduled increase in their prices in the first weeks of 2020 was averted by the National Petroleum Authority with the application of the Price Stabilization and Recovery Levy (PSRL).

While the exchange rate performance — a key determinant in the price build-up — improved, the energy policy think tank argues that it would still not be enough to offset the increase in prices of oil on the international market.

—CitinewsRoom

In preparing for MARPOL 2020, Ghana’s Ministry of Energy (MoE) constituted a committee of key stakeholders in 2018 to review the implications of the new IMO rule. The committee comprised of National Petroleum Authority (NPA), Ghana Maritime Authority (GMA), Ghana Ports & Harbours Authority (GPHA), Association of Oil Marketing Companies (AOMCs), Environmental Protection Authority (EPA), Ghana Statistical Authority (GSA) and the MoE.

CLICK LINK IMO-FACT-SHEET.pdf (91 downloads)

The Institute for Energy Security (IES) is predicting oil marketing companies will likely increase the prices of their petroleum products to make up for the marginal price movement of crude oil on the international market.

“Taking into consideration the two percent increment in prices of Crude oil, coupled with the 0.95 percent and 1.01 percent marginal increment in the prices of Gasoil and Gasoline respectively on the international market; the Institute foresees prices of fuel on the local market losing stability,” the energy policy think tank said in a press release.

Currently, the national average price of fuel per litre at the pumps is still pegged at GH¢5.36 for both petrol and diesel after a scheduled increase in their prices in the first weeks of 2020 was averted by the National Petroleum Authority with the application of the Price Stabilization and Recovery Levy (PSRL).

While the exchange rate performance — a key determinant in the price build-up — improved, the energy policy think tank argues that it would still not be enough to offset the increase in prices of oil on the international market.

Crude oil prices continue to remain above the US$60-dollar margin for this window. Escalation of tension between the United States and Iran saw Brent Crude gaining 6 percent to reach US$70.24 per barrel – the first time prices have hit that amount in more than six months.

Oil prices tumbled as President Donald Trump signalled tensions with Iran eased. Over the last two weeks, Brent crude rose marginally from $65.43 per barrel to close at $66.74 per barrel on average terms.

—

The Vice President Dr. Mahamadu Bawumiah has inaugurated a state-of-the-art Command Centre for the National Petroleum Authority’s Bulk Road and Electronic Cargo Tracking Systems to control and monitor the distribution of petroleum products across the country. This technology will also help curb illicit activities in the petroleum downstream industry.

According to the NPA, the dominant use of road transportation or BRVs in the supply chain is associated with many challenges such as transit product shortages and false haulage claims. The NPA in 2014 introduced the Bulk Road Vehicle (BRV) tracking system to ensure transparency in the movement of BRVs.
Chief Executive of the NPA Hassan Tampuli speaking at the launch in Accra on Tuesday, January 14, 2020, lamented how the NPA was in the past exploited by transport service providers because of the absence of an effective tracking system.
“It was estimated that the revenue loss as a result of these fraudulent practices amounted to about 12.3% of annual freight paid. The estimated revenue loss in 2014 was then about GH¢43 million”, he said.
The Vice President Dr. Bawumia who officially launched the new tracking system and command centre said the government is concerned about the illegal activities in the industry which undermine revenue collection and maritime and national security.
“ It is estimated that these illegal activities cost the country over USD 200m per annum in the form of lost direct petroleum tax revenue, subsidies that do not get to the targeted constituencies, and abuse in transport claims for transportation of petroleum products among others”.

This new technology is part of the NPA’s broader agenda to ensuring efficiency and fighting corruption in the petroleum downstream sector. The 2018 CBOD Industry Report stated that the NPA’s regulatory interventions to curb the illicit trade of petroleum products which forced sale through official channels only saved the nation GHS 952.43m in both taxes and regulatory margins.

The Vice President commended the NPA’s initiative saying, “This is yet another example of how we can leverage on technology to tackle some of the problems that continue to undermine our ability to build the Ghana we want”.
He also hinted at digitizing premix fuel to check wastage and illegal smuggling.

The National Command Centre is a 24-hour facility for the Bulk Road and Electronic Cargo Tracking System to control and monitor petroleum products distribution from imports and refinery production to the retail outlets and bulk customers across the country.

Despite a 9 percent decrease, Urals spot prices in Northwest Europe were still one and a half times higher in 2019 than in 2016 ($63.3 versus $41.1 per barrel, according to Refinitiv), when the first OPEC + agreement was signed.

As a result, the Russian budget again, as in 2017-2018, received additional income, which reached 6.2 trillion rubles (just over $100 billion) from the moment the deal was concluded, as follows from estimates of the Russian Ministry of Energy.

Growth above expectations
Thus, the deal once again proved its effectiveness, which turned out to better than the initial market expectations. For example, in 2016, the World Bank and the US Energy Information Administration ( EIA ) predicted that between 2017 and 2019, the average Brent price would be $59.3 and $58.4 per barrel, respectively, while in fact it reached $63.2 per barrel.

At the same time, in 2018, the average actual price of Brent ($71.3 per barrel) exceeded the forecast level of the World Bank ($59.9 per barrel) and EIA ($57 per barrel) by more than $10.

Such a significant difference is partly due to the high discipline among the deal’s participants: thus, in November 2019, OPEC members achieved a compliance rate of 154%, and non-OPEC countries by 125% according to the International Energy Agency (IEA). This piqued the interest of hedge funds which began to pile into futures as the deal gave them the opportunity to earn additional income.

It is no coincidence that oil prices rose during the December OPEC summit in 2018 and 2019, in which the cartel decided to extend, and even upgrade the deal: thus, in the first week of December 2018, Brent futures at the Intercontinental Exchange (ICE) grew by 4.6% (to $61.4 per barrel), and in the first week of December 2019 – by 5.6% (to $ 64.3 per barrel).

Asymmetric gain
However, Russia was not able to derive high benefits from the deal. By tying the budget to an oil price of $40 per barrel, the government was able to replenish the National Wealth Fund: in the first eleven months of 2019 alone, it more than doubled , from $58.1 billion to $124 billion.

The federal budget itself also benefited: if in 2016 its deficit amounted to 3.5% of GDP, then in the first eleven months of 2019 its surplus reached an impressive 3.1% of GDP, as follows from estimates of the Economic Expert Group.

However, the government failed to restart economic growth, which had already slowed down to 1.8% in pre-sanctioned 2013, which is insignificant for developing countries.

Moreover, the very existence of a budget surplus became a headache for the government: if in 2016 the federal budget left unspent 220 billion rubles, then in 2018 – 778 billion rubles, and in 2019 – even 1 trillion rubles, as follows from the estimates of the Russian Accounts Chamber.

Saudi Arabia benefited much more from the deal: largely thanks to increased oil prices, the Kingdom not only successfully carried out an IPO of Saudi Aramco, whose capitalization has already exceeded $1.7 trillion, but also launched the Vision-2030 program, which aims to diversify the economy through major investments in infrastructure, tourism and human capital.

By making a decisive contribution to cutting oil production, the Saudis managed to reduce the budget deficit (from 12.9% of GDP in 2016 to 3.8% of GDP in 2019, according to IHS Markit), and therefore, a Russian exit from the deal will not be too painful for them. The fact that such a scenario is feasible is evidenced by the fact that in December the OPEC+ agreement was extended for only three months – this is a clear sign that in 2020 the deal will be revised to one degree or another.

Risks mixed with opportunities
For Russia, this is not only a threat, but also an opportunity. On the one hand, an exit from the deal will remove barriers to production at fields that have been commissioned by Rosneft (Suzunskoye, Russkoye, Zapadno-Erginskoye, Yurubcheno-Tokhomskoye) and Gazprom Neft (Kuyumbinskoye, Vostochno-Messoyakhskoye) in recent years. As a result, this will accelerate the growth of Russian oil output, which slowed down from 5% in 1999-2008 to 1.3% in 2009-2018, according to BP data.

On the other hand, even with a drop in oil prices, the federal budget is expected to remain stable, since prices of $40 per barrel are now sufficient to cover its expenses, rather than more than $100, as it was back in 2013. Therefore, a revised deal will not be a disaster.

Russia needs to start preparing to exit the deal now, instead of delaying it until the United States becomes a major net exporter of oil, which could undo OPEC efforts to reduce production.

—Oilprice.com

The Chamber of Petroleum Consumers (COPEC) has called on the government to take immediate steps to hedge the purchase of crude oil from the international market.

It says it will enable the country avoid paying more for the product in the coming days.

Oil hedging is used to reduce or eliminate a company or country’s exposure to fluctuating oil prices.

It is a contractual tool allowing a company or country to fix or cap an oil price at a certain level or period of time.

The advice follows heightened tensions between the United States of America (USA) and Iran in the gulf region, a phenomenon which is already beginning to impact the prices of crude oil on the international market.

In an interview with the Daily Graphic in Accra yesterday, the Executive Secretary of the chamber, Mr Duncan Amoah, said the signs on the wall clearly pointed to a situation where the prices of the black gold would be increased and, therefore, there was the need for the government to be proactive in ensuring that the situation did not affect consumers in the country.

“The government should be able to hedge the prices on oil imports for at least the next six months.

“It should be engaging the crude oil importers now on the issue because paying more for the commodity could worsen the economic conditions of the people,” he said.

Processing local crude
Making other suggestions as to how the government could control the prices of the commodity locally to save Ghanaians from paying extra when global market prices of crude oil escalated, Mr Amoah said the time had come for the local refinery, Tema Oil Refinery (TOR), to be retooled and equipped “so that whatever we produce here as an oil-producing nation, a certain percentage can go to the local refinery to be processed for the local market”.

That, he explained, was to ensure that the international market dynamics did not “affect us negatively as we are seeing now”.

“There is a good reason for having Bulk Oil Storage and Transportation (BOST) and TOR, and if we go back to the drawing board, we can leverage their full benefit as a country,” he argued.

Dual pricing policy
Mr Duncan also pressed home the need for the government to immediately adopt what he described as the dual pricing policy which allowed the government to optimise taxes when prices were lower and ease down on them when the global oil market dynamics seemed unfavourable.

He opines that around these times when Ghanaian workers are not seeing a corresponding increase in their income and fuel prices are galloping upwards, “one will expect a quantitative easing on the part of the government to ensure that at least some of the taxes the government can do away with in the interim are done away with”.

Mr Amoah did not lose sight of the fact that the government generated a lot of revenue from taxes.

However, he said, “When international market prices of crude oil are going up or are soaring, there is always a corresponding increase in government revenue because we are an oil-exporting nation.”

As a result, whatever windfall the government makes on the oil exports in good times, one would expect some easing as far as the taxes collected from taxi and trotro drivers are concerned to balance off.

He further noted that such a move would ensure that the economy was not taken off balance or thrown out of gear.

Asked why the government had not heeded the position of the chamber in that regard, Mr Amoah said governments normally only considered what they were generating from taxes and not what the impact really was on the people.

He argued that the more the petroleum prices went up, there was a rippling effect on the economy and the government’s revenue would shrink because the general economic activities would be slow.

Tensions in Gulf region
Mr Amoah said the tensions in the Gulf were quite fluid and the earlier the government took pragmatic steps to prevent an escalation of prices on the people, the better.

“We cannot tell when Iran will strike again. Let’s remember that 20 per cent of the world’s oil supplies go through the Strait of Hormuz and, therefore, any instability in that area will see prices of crude oil escalating,” he said.

The Strait of Hormuz is a strait between the Persian Gulf and the Gulf of Oman.

It provides the only sea passage from the Persian Gulf to the open ocean and is one of the world’s most strategically important choke points.

Mr Amoah reiterated the need for the government to reconsider the option of hedging now to make the prices of petroleum products predictable.

“People can plan their lives if there is certainty about the prices oil petroleum products and that is what we need now,” he said.

Latest on the tensions
Iran fired more than a dozen missiles at two Iraqi military bases hosting US troops yesterday.

The missiles targeted the Ain al-Assad airbase in Anbar province and a facility near Erbil’s airport in northern Iraq early on Wednesday morning; they were fired in retaliation for the killing of top Iranian Commander Qassem Soleimani by the United States, according to Iran.

Oil prices stabilise
Oil prices retreated yesterday, a dramatic reversal from the initial spike caused by Iran’s missile strike on bases in Iraq that house US troops, CN Business reports.

The pullback from the initial rally reflects easing fears about the risk of a spiralling tit-for-tat conflict between the United States and Iran. Investors are heaving a sigh of relief that Iran’s attack did not do more damage and has so far not drawn a response from President Donald Trump.

US crude fell 1.5 per cent to $61.75 a barrel yesterday. That marks a sharp pullback from the late Tuesday high of $65.65 a barrel.

“The extent of the retaliatory attacks looks to have been limited,” JBC Energy wrote in a note to clients on yesterday.

“The market will be watching keenly today for hints as to whether or not President Trump will step into a further cycle of escalation,” it added.

Brent oil, the global benchmark, dipped 0.8 per cent to $67.70 a barrel. Brent had traded as high as $71.75 a barrel earlier.

There is a growing sense that Iran’s attack was not as bad as initially feared. No casualties have been reported. Some in the Trump administration think Iran intentionally missed areas with Americans.

—graphic.com.gh

Oil prices have rose after two bases hosting US troops in Iraq were hit by ballistic missiles.

Brent crude was up by 1.4% at $69.21 per barrel in the middle of the Asian trade, easing back from earlier gains.

So-called safe haven assets, like gold and the Japanese yen, also rose on the news.

At the same time global stock prices were sent lower on concerns over the growing conflict in the Middle East.

Japan’s benchmark Nikkei 225 stock index fell by 1.3%, and Hang Seng in Hong Kong was down 0.8%.

Iranian state television said the attack was a retaliation for the killing of the country’s top commander Qasem Soleimani . Brent Crude Futures – North Sea – Mar20

Source: WebFG – 8th Jan 2020

That could disrupt shipping in the world’s busiest sea route for oil, the Strait of Hormuz . Around a fifth of global oil supply passes through the strange.

—BBC

Oil prices have climbed above $70 a barrel for the first time in four months amid fears that the US air strike that killed Iran’s top military commander may trigger a retaliation.

The global oil markets have risen by more than 5% to $70.73 a barrel since the attack that killed Qassem Suleimani in Iraq last week.

The attack has sent shockwaves through global markets, causing equity indices in Asia, the US and Europe to slump while the benchmark price of Brent crude climbed to its highest level since September.

Oil hits $70 and stocks slide as US-Iran tensions rise – business live

Read more
Iran has vowed to take revenge against the US for the assassination of Suleimani, who was one of the most powerful leaders in Iran, and the commander of the Islamic Revolutionary Guard Corps Quds Force.

The oil price continued to climb after Friday’s surge when the US warned over the weekend that Iran might retaliate by targeting oil facilities in the Middle East, which could disrupt global oil supplies and drive prices higher.

A prolonged oil price surge could raise the risk of a global economic recession and would add about 2p a litre to the price of petrol at the pumps.

However, market analysts at Goldman Sachs and UBS have cast doubt on whether oil prices will continue to rally beyond $70 a barrel because of strong production from outside the Middle East.

UBS expects the global oil market to be oversupplied this year because of rising production from the US and Norway, which would keep prices from rising above $70.

Paul Donovan, the chief economist at UBS Global Wealth Management, said the global market’s focus on the oil price after the attack is “a rather 1970s reaction” that is “perhaps not appropriate for 2020”.

The oil price spike to more than $70 a barrel after a Saudi oil refinery facility was attacked last September proved short-lived, with the price retreating to less than $65 within days.

“More serious economic damage may come if there is cyber retaliation – which seems suited to this situation – or from general uncertainty,” Donovan said.

The geopolitical jitters have triggered a surge in the market price for gold, which asset managers typically consider a safe haven in times of turmoil.

The market price for gold rose to a near seven-year high of $1,575 an ounce as global equity markets fell and analysts expect the price could climb higher if the US dollar weakens relative to other currencies.

A spokesman for the RAC said a prolonged oil price rally would add “at least 2p” per litre to the price of petrol, weeks after the first rise in six months in December.

The average price of a litre of petrol rose by almost 0.25p in December to 126.1p, according to the RAC. Motorists are paying more for the fuel because of a combination of rising oil market prices and the cost of meeting EU rules to include more biofuels in petrol and diesel.

— guardian.co.uk