Ghanaian drivers, transport operators, and households may get another piece of good economic news as global oil prices are projected to drop sharply over the next two years. According to Fitch Solutions, a UK-based research firm, Brent crude, the global benchmark for oil prices, will average $83 per barrel in 2026 before sliding further to $71 per barrel in 2027. This forecast marks a fall of close to 15 percent between the two years.
The projected decline in oil prices is tied to two main developments: the reopening of the Strait of Hormuz, a narrow waterway between Iran and Oman, and a normalisation of oil production across the Middle East. Fitch Solutions also expects OPEC+, the alliance of oil-producing nations led by Saudi Arabia and Russia, to fully unwind the production cuts it has maintained in recent years. These changes would push global oil supply above demand, putting sustained downward pressure on prices through 2027.
Falling fuel prices would ease transport costs across Sub-Saharan Africa, producing disinflationary second-round effects. Cheaper fuel would filter through to lower costs for moving goods and people, which in turn helps tame broader price increases in the economy. For Ghana, where transport fares and food prices are closely linked to fuel costs, this could reinforce gains already being seen on inflation.
Ghana has been experiencing a decline in inflation, with Bank of Ghana data showing inflation at 5.2 percent, a level the central bank described as firmly within good territory. Additionally, lending rates have nearly halved, falling from 30.25 percent to 15.7 percent since December 2024. A further fall in global oil prices could add momentum to that easing cycle.
Fitch Solutions expects most Sub-Saharan African central banks, including those in South Africa, Nigeria, and Kenya, to resume monetary easing in 2027 as fuel-driven inflation pressures recede. The region has so far avoided a sharp inflation spike, crediting greater currency stability and strong prices for key regional exports such as gold, copper, cocoa, and coffee.
The forecast arrives as Ghana continues talks with the International Monetary Fund over its 2027 budget, with debt sustainability and inflation among the issues under discussion. The Fund has also flagged risks to Ghana's cocoa earnings in separate warnings issued in October.
Fitch Solutions' forecast rests on assumptions that have not yet occurred, including the reopening of the Strait of Hormuz and a full unwinding of OPEC+ cuts. No Ghanaian government or Bank of Ghana response to the Fitch Solutions forecast was available at the time of reporting.
Key points
- Fitch Solutions forecasts Brent crude will drop nearly 15% to an average of $71 a barrel in 2027.
- The projected decline in oil prices is tied to the reopening of the Strait of Hormuz and a normalisation of oil production across the Middle East.
- Falling fuel prices would ease transport costs across Sub-Saharan Africa, producing disinflationary second-round effects.
