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The Chief Executive Officer of the Ghana Chamber of Bulk Oil Distributors, Dr. Patrick Kwaku Ofori, says Bulk Oil Distributors are currently bleeding due to the harsh economic conditions they have to operate in.<\/p>\n
Speaking on JoyNews\u2019 PM Express Business Edition, he explained that the prevailing economic situation has led to some distributors taking a break from the business to wait out the storm in order not to accrue any more losses.<\/p>\n
Those who continue to trade, he said, are really having a terrible time and are most likely being driven to continue trading in order to make up for the huge losses they have accrued in earlier trades.<\/p>\n
\u201cYou normally would not see that, but some of them who wanted to tread cautiously decided that \u2018you know something, enough, I\u2019m not trading. We\u2019ll sit down and then look at how the market will behave and when things normalize before we come in\u2019.<\/p>\n
\u201cThere are others who are also risk averse and who love to take those gambles. But I can tell you most of them are bleeding. And I go into meetings with some of our members, you look straight into their eyes and you could clearly see that it\u2019s difficult times for some of them.<\/p>\n
\u201cIt\u2019s like a gambler who is losing but still has got faith that things are going to improve and that you need to continue to play before you can recover some of the losses that you\u2019ve made. And clearly it hasn\u2019t been easy,\u201d he said.<\/p>\n
H noted that the main situation affecting them is the depreciating cedi amid fuel price fluctuations on the international market, as well as insufficient dollars to pass around in the local economy.<\/p>\n
\u201cYou know there was a point in time that when the Russia-Ukraine started and there was that fear that product shortages world over and other things. So a lot of products were imported in town. We brought in a lot of products in-country, and then the cedi started misbehaving.<\/p>\n
\u201cYou\u2019ve lock in these products at a certain rate, by the time after you\u2019ve sold the product and you\u2019re going to buy forex it has started going a certain trajectory,\u201d he said.<\/p>\n
He noted that the rapid depreciating of the cedi against the dollar has cost many distributors millions of dollars in losses; this he says has been exacerbated by the fluctuating price of fuel on the international market, currently on a steady rise.<\/p>\n
\u201cSo that notwithstanding, about the volumes of products that you\u2019ve brought in-country that I was talking about and then also maturing LCs that you quickly need to cash in on. So most of the members in order to keep their credit lines open and then also to keep their banks happy needed to even give super abnormal discount on products knowing clearly that they were even going to make some losses.<\/p>\n
\u201cBecause they needed to meet those obligations because the sanctions and other things that are linked to not being able to honour your LCs and then also not being able to honour your commitment in terms of open credit and the consequence to your business reputation and your ability to even stay afloat,\u201d he said.<\/p>\n
Meanwhile, an insufficient supply of dollars in the local market has made it even more difficult for distributors who are currently holding billions of cedis in their bank accounts to change to dollars to pay their suppliers, he said.<\/p>\n
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