First Consignment Of Oil For Gold Finally Lands

by Isaac Mintah
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Sources close to has indicated the first consignment of government’s ‘Oil For Gold’ deal arrived yesterday, January 15 2023 at the Tema Port from Dubai.

It established that the Bulk Oil Storage and Transportation (BOST) Company is the lead broker of the project, supported by GOIL and other oil marketing companies the country.

The maiden consignment consists of 40,000 metric tons of oil and expected to be rise subsequently, going forward.

Ghana currently has a monthly oil consumption requirement of 180,000 metric tons of oil.

The government had earlier announced its plans to trade oil products for gold rather than the usual United States’ dollar reserves.

In November, last year, Vice President Dr Mahamudu Bawumia explained how the move was meant to tackle the unstable foreign currency reserves coupled with the demand for dollars by oil importers; which weakened the local cedi.

The decision, billed to begin this first quarter of 2023, he observed, “will basically change our balance of payments and significantly reduce the persistent depreciation of our currency.”

Dr Bawumia added that using gold would prevent the exchange rate from directly impacting fuel or utility prices as domestic sellers would no longer need foreign exchange to import oil products.

It would be recalled that Ghana’s Gross International Reserves stood at around US$6.6 billion at the end of September 2022, equating to less than three months of imports cover.

The figure was down from around $9.7 billion at the end of last year, thus, according to the government.

“The barter of gold for oil represents a major structural change,” Dr. Bawumia emphasised.

In most phenomenon, countries sometimes trade oil for other goods or commodities, barter deals of such nature often involve an oil-producing nation receiving non-oil goods.

The new move comes amid plans by government to contain the economic challenges being faced by the country.

Earlier last year, Finance Minister Ken Ofori-Atta announced measures to cut spending and boost revenues in a bid to tackle a spiraling debt crisis.

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