Ghana May Face Higher Import Costs amid Global Shipping Disruptions – Economist
By: Solomon Nartey Tetteh
Senior Lecturer in Finance and Economics at the University of Ghana Business School, Dr. Jabir Mohammed has cautioned that the geopolitical tensions could trigger broader economic consequences, particularly in international shipping and trade.
Speaking on the Business Breakfast on Zed 101.9FM, Dr. Mohammed explained that shipping companies operating along key global trade routes in the affected region may begin to impose political risk premiums on cargo transport due to security concerns.
“Shipping lines that normally pass through those routes may avoid them entirely. That will lengthen their journeys and increase operational costs, which will eventually be passed on to consumers,” he said.
He warned that the additional charges and longer shipping routes could lead to higher prices for imported goods, contributing to inflationary pressures in countries like Ghana that depend heavily on imports.
Dr. Mohammed therefore urged policymakers and businesses to prepare for possible price increases in the coming months as global market conditions remain uncertain.
He also warned that escalating geopolitical tensions in the Middle East are likely to push fuel prices higher globally, with potential ripple effects on Ghana’s economy.
Dr. Mohammed further explained that recent international developments have led to a sharp adjustment in global crude oil prices, which are now hovering above USD 100 per barrel.
According to him, the surge in prices is largely driven by ongoing conflicts in the Middle East involving several countries, a situation that has significantly disrupted global oil supply.
“There have been international adjustments in terms of fuel prices. Prices have gone up to about 100 dollars and above per barrel mainly due to the tensions in the Middle East,” he said.
Dr. Mohammed noted that the region plays a crucial role in global oil production, with some countries controlling a substantial portion of the world’s supply. As a result, any disruption in that region has immediate implications for the international oil market.
He explained that the current tensions have caused a drop in global oil supply by an estimated 25 percent, creating a classic supply-and-demand imbalance that has driven prices upward.
“When the quantity of oil available on the market drops while demand remains high, prices inevitably go up. It is simply the forces of demand and supply at work,” he stated.
The economist indicated that the increase in global crude oil prices would inevitably affect fuel prices in Ghana, as the country relies heavily on imported refined petroleum products.
His comment comes after the upward adjustment of the fuel price floor for the second pricing window of March.
