The Institute for Energy Security (IES) has recently revealed some concerning statistics regarding Liquified Petroleum Gas (LPG) usage in Ghana. According to their findings, there has been a noticeable decrease of approximately 4.47% in LPG consumption between January 2020 and December 2023. This is in stark contrast to the growth of about 6.43% that was observed in the previous four years, spanning from January 2016 to December 2019.
During this period, November 2020 stood out as the month with the highest LPG consumption, exceeding 35 million kilograms, while April 2023 marked the lowest point. The IES also conducted a regression analysis, which revealed that the total annual LPG consumption in Ghana fluctuated between 2020 and 2023. Consumption peaked in 2021 at 345,478,919 kilograms and declined in 2022 to 305,076,209 kilograms.
Notably, the ex-pump price per kilogram of LPG more than doubled, increasing by 116% from GH¢5.81 to GH¢12.57 between January 2020 and December 2023. This is in comparison to a 57% increase observed between January 2016 (GH¢3.43) and December 2019 (GH¢5.40). The IES highlighted fluctuating trends in LPG prices during the same period, with significant spikes observed from November 2022 to April 2024. Factors such as ex-refinery prices, supply and demand dynamics, and policies impacting LPG prices were identified as contributors to these fluctuations.
The first four months of 2024 saw a notable 30% increase in the average price of LPG, rising to GH¢16.11 per kilogram in April from GH¢12.36 per kilogram in January. Increases in existing taxes and levies, as well as the introduction of new ones, played a significant role in the 177% price hike observed from January 2020 to April 2024.
Approximately 16.47% of the variance in LPG consumption in Ghana between January 2020 and December 2023 can be explained by fluctuations in LPG price per kilogram. The remaining 83.53% is attributed to other factors such as economic conditions, currency depreciation, restrictions on new LPG outlets, and government policies. This data sheds light on the complex factors influencing LPG consumption and pricing in Ghana.
