COPEC urges Ghana to allow local refineries to pay for crude in cedis

The Chamber of Petroleum Consumers (COPEC) is urging the Ghanaian government to allow local refineries to pay for domestic crude oil in cedis rather than US dollars. COPEC CEO Duncan Amoah argues that requiring refineries to source dollars for crude purchases creates a currency mismatch, as these facilities sell their finished petroleum products to the Ghanaian market in local currency.

COPEC warns that forcing refineries into the foreign exchange market to buy crude could intensify pressure on the already weakening cedi by forcing them to compete with other importers for scarce dollar reserves. The proposal follows the commencement of domestic crude sales by Tullow Oil from the Jubilee and TEN fields, including an initial cargo acquisition by Sentuo Oil Refinery.

While the move could provide relief to refineries by reducing transaction costs and exchange-rate volatility, analysts note that cedi settlement does not eliminate the underlying dollar economics of crude oil. The success of the proposal depends on creating a commercial framework that supports domestic refineries without forcing upstream producers or the state to absorb financial losses.