Forecasting Refined Petroleum Products Prices in Ghana

Ghanaian’s demand for refined petroleum products keeps increasing although monthly prices of the product keeps rising. The paper aims to forecast refined petroleum products (gasoline, diesel, kerosene and LPG) future prices trends in Ghana. Employing benchmark techniques, cointegration, generalized autoregressive conditional heteroskedasticity (GARCH) and artificial neural network (ANN) to analyze in-sample (Jan-89 to Oct-14) and out-of-sample (Nov-14 to Dec-30) monthly data of refined petroleum products and socio-economic variables. The in-sample investigation result suggested that averagely refined petroleum products are uniformly priced in Ghana and LPG price is highly adjusted in times of refined petroleum product increment. Out-of-sample results indicates a steadily price surge of refined petroleum products in the future with ANN forecasting technique recording the best forecasting performance value.