Mahama Orders Payment for Ghana’s Crude Oil in Cedis to Ease Pressure on Local Currency

Ghana’s President John Mahama has ordered a review of the dollar payment system for crude oil sales, directing that local refineries should pay for domestically produced crude in Ghana cedis instead of US dollars in a move aimed at easing pressure on the local currency.

The policy shift, which was announced by Energy Minister Dr John Jinapor, came after the President questioned why the Tema Oil Refinery and the private Sentuo refinery were forced to buy dollars to pay for crude pumped from Ghanaian soil. Under the current legal framework, the Petroleum Holding Fund and the Petroleum Revenue Management Act require that payments for crude oil, including Ghana’s own Jubilee Medium Sweet crude, be made in foreign currency. “When Tema Oil Refinery takes the crude process and sells it in Ghana cedi; why don’t we pay Ghana cedi into that account rather than going to the forex and buying dollars,” Mahama reportedly asked during a meeting with his Energy Minister, Finance Minister and the Central Bank Governor.

The Central Bank Governor agreed with the President’s reasoning, noting that buying dollars on the market puts pressure on the cedi and adds cost to the transaction. A structuring meeting is expected to take place within days to restrategise the implementation. The instruction came as TOR received one million barrels of Ghana’s own Jubilee Medium Sweet crude aboard the MT Apache on 1 August, alongside newly refurbished units at the refinery.

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The policy is modeled after Nigeria’s naira-for-crude initiative, which began in October 2024 when the Federal Executive Council approved President Bola Tinubu’s directive for the Nigerian National Petroleum Company Limited to sell crude oil to domestic refineries in naira. That policy was designed to ease foreign exchange pressures on the US dollar, reduce transaction costs, and strengthen the local currency.

The move comes at a time when Ghana’s cedi has lost approximately 8.89 per cent of its value in 2026, with fuel prices climbing as crude prices rose and the currency slipped. Fewer dollar purchases along the supply chain would not cap fuel prices, but they would remove one self-inflicted cost that adds to the burden on consumers.

The shift in policy would require an amendment to the Petroleum Revenue Management Act, which currently mandates that payments for crude oil be made in foreign currency. Jinapor recalled the President’s directive to “rethink, take a second look at it” and explore the possibility of allowing TOR and Sentuo Refinery to pay for Ghana’s locally produced Jubilee Medium Sweet crude oil in cedis.

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