Economist Warns Ghana Could Face Fuel Price Hikes Amid US–Israel Strikes on Iran
Economist Prof Godfred Bokpin has warned Ghana could face sharp fuel price hikes and higher living costs amid Middle East tensions
Speaking on a local radio programme, he noted that any major disruption to oil supplies in the Middle East would quickly affect Ghanaian consumers.
According to him, higher crude prices would likely force oil marketing companies to raise pump prices, which would subsequently increase transportation costs and feed into inflation, affecting the prices of goods and services across the country.
He revealed that the current military strikes, now in their fourth day, have targeted Iran’s military and nuclear facilities. Iranian authorities, he said, have threatened large-scale retaliation and hinted at potential restrictions on key shipping routes, particularly the Strait of Hormuz. This narrow waterway is critical for the global crude oil supply, and any disruption could lead to serious shortages and drive up prices internationally.
Prof. Bokpin also pointed out that Ghana’s recent stability in the cedi would offer limited protection if international oil prices rise sharply. He noted that the pass-through effect from global crude prices to domestic pump prices is strong, meaning that even a stable exchange rate may not be sufficient to cushion consumers from higher costs.
He added that the uncertainty surrounding the conflict is already affecting global markets and making long-term planning for businesses and governments more challenging. According to him, the ongoing instability underscores the difficulty of maintaining economic stability in the face of sudden external shocks.
Prof. Bokpin further revealed that although OPEC may consider increasing production to control price pressures, such interventions could arrive too late to prevent short-term spikes if supply routes remain restricted. He emphasized that fuel price increases have historically been highly sensitive in Ghana, often triggering higher transport fares and rising food costs.
He urged policymakers to monitor developments closely and prepare contingency measures to protect vulnerable consumers if global crude oil prices escalate in the coming days.
