Western Oil embargos on Iran harm Ghana

The Minister explained the sanctions and accompanying insecurity in the Persian Gulf region has an effect on the movement of oil prices on the world market. "If people perceive that the Middle East which produces a significant portion of the crude oil demand is threatened, prices would begin to escalate. And that would mean that many countries who are not producing oil and many more marginal oil producers would have to spend a significant chunk of their foreign exchange on the importation of oil and that includes Ghana," he stressed. According to him, the overriding effect would have to move resources away from projects that government has already budgeted for to cover the high demand of energy importation which is also a requirement for any country's growth. Government, he said was watching developments in the Persian Gulf closely and expressed the hope an amicable solution would soon be found to the Iranian nuclear issue. "As an oil importer, the fluctuations in prices on the world market will affect crude imports to the country," he said. He recalled that in 2008 when oil prices hit 140 dollars a barrel, the country had to make some adjustments by freezing our deregulation to enable Ghanaians buy crude oil on the market. "Iran as at now supplies about 5% of global demand and if there is a shortfall, the OPEC and OECD countries have to step in to supplement" - he opined. Dr. Sam Buame, an Entrepreneurship and International Market Expert is also the opinion that because Ghana imports the bulk of her crude oil, the ban on Iran will affects it more negatively. "As at now, Ghana needs about 60,000 barrels of crude daily and none of what is consumed here is sourced from our oil fields. It is also interesting that the Tema Oil Refinery only has capacity to refine about 45,000 barrels but at present has been rendered incapacitated", the lecturer at the University of Ghana Business School lamented.