Understanding crude oil import demand behaviour in Africa: The Ghana case

As in many African countries, crude oil importation is a major drain on the economy of Ghana. We estimate short-run and long-run import demand models for crude oil using data over the period 1980–2012. Results show that demand for crude oil is price inelastic in the short-run but elastic in the long-run. Other important drivers of crude oil import are the real effective exchange rate, domestic oil production and population growth. Income is found to be the strongest driver of crude oil demand. Policy implications of our results are presented.