The primary objective of this study will be to work out the financial performance of oil marketing companies (OMCs) in Ghana during petroleum price regulation and deregulation regimes. The researcher adopts the event study design and sampling strategy of purposive random sampling techniques in this study. In this study, the researcher seeks to evaluate the financial performance of oil market companies (OMCs) in Ghana during petroleum price regulation and deregulation regimes. The study also found that, after the deregulation of petroleum prices, there was positive growth in the company's gross sales. The positive effect of the company's financial performance can be attributed to the introduction of the petroleum price deregulation in the downstream petroleum industry. This is to say that the deregulation policy was gradually impacting favourably on the financial performance of the company.
Table of Contents
1.0 Abstract
2.0 Introduction
3.0 Petroleum Pricing
4.0 Financial Performance and Price Regulation
5.0 Determinants of Financial Performance of Oil Marketing Companies (OMCs)
Supply Chain Efficiency
Foreign Exchange Rates (Forex)
International Oil Prices
6.0 Empirical Review/Evaluation
7.0 Research methodology
Design of the Study
Analytical Model
Test of Independence
Differences in Financial Performance during Regulated and Deregulated Periods
Analysis of Variance (ANOVA) (Statistical Significance of the Model)
The Chi-square (χ2) Test for Independence
8.0 Conclusion and Recommendations
9.0 Reference
Research Objectives and Themes
The primary objective of this study is to evaluate the financial performance of oil marketing companies (OMCs) in Ghana by analyzing the impact of petroleum price regulation and deregulation regimes on their profitability and gross sales, using Star Oil Company Limited as a case study.
- Impact of petroleum price regulation on corporate financial performance
- Comparative analysis of regulated vs. deregulated market periods
- Role of supply chain efficiency and macroeconomic factors (Forex, oil prices)
- Quantitative evaluation using Chi-square tests and ANOVA models
- Operational performance in the downstream petroleum industry
Excerpt from the Book
Petroleum Pricing
The economic principle suggests that regulation can either be structural or conduct regulation. Structural control or regulation denotes policies on market structure such as entry and exit rules; whiles conduct regulation regulates the behaviour of market participants through strategies such as price regulation as accordingly stated by Kay and Vickers (1990). Rogers (2003) showed that price control of petroleum products results in an increase in prices and often controls competition. Coady et al. (2006) also established that only sixteen (16) out of forty–eight (48) developing economies have a liberal pricing mechanism for petroleum products while sixteen (16) others employ the ad hoc basis by directly controlling and adjusting oil prices, including Ghana. The Organisation of Petroleum Exporting Countries (OPEC), influences global petroleum prices by using the pricing-over-volume technique. It coordinates and unifies various petroleum policies of the member countries. The member countries adjust the quantity of oil production to achieve stable prices and supply. OPEC members collectively control 81.9% of the total oil reserves while they also supply 43.5% of the global crude oil production (Khadartseva & Cherkasova, 2017).
Chapter Summary
1.0 Abstract: Provides a high-level overview of the research scope, highlighting the study's focus on OMCs in Ghana during shifting regulatory regimes and summarizing key findings regarding positive sales growth post-deregulation.
2.0 Introduction: Sets the context by discussing the impact of global oil price fluctuations on developing economies and the strategic importance of the downstream petroleum sector.
3.0 Petroleum Pricing: Examines the theoretical underpinnings of price regulation, including structural versus conduct regulation, and the role of global bodies like OPEC in influencing market prices.
4.0 Financial Performance and Price Regulation: Reviews existing empirical evidence regarding how price controls influence firm profitability and market competitiveness in the oil sector.
5.0 Determinants of Financial Performance of Oil Marketing Companies (OMCs): Identifies key operational and macroeconomic drivers, such as supply chain efficiency, foreign exchange volatility, and crude oil price movements, that affect company revenue.
6.0 Empirical Review/Evaluation: Synthesizes previous scholarly work from different countries on the consequences of price interventions for corporate performance in various industries.
7.0 Research methodology: Details the quantitative research design, including the use of an event study approach, ANOVA models, and Chi-square hypothesis testing to analyze the data.
8.0 Conclusion and Recommendations: Synthesizes the final results, concluding that deregulation had a positive impact on company performance, and provides policy recommendations for future governmental oversight.
Keywords
Petroleum price regulation, Petroleum price deregulation, Return-on-Equity, Oil marketing companies, Chi-square, ANOVA, Trend analysis, Star Oil Company Limited, Ghana, Downstream petroleum industry, Gross sales, Market competition, Financial performance, Supply chain efficiency, Economic recession.
Frequently Asked Questions
What is the primary goal of this research study?
The research aims to determine the impact of petroleum price regulation and deregulation on the financial performance of oil marketing companies in Ghana.
What are the central themes of the work?
The core themes include petroleum price dynamics, the regulatory environment in Ghana, firm-level financial performance metrics (specifically ROE and gross sales), and the influence of supply chain and macroeconomic factors.
Which scientific methods were employed for data analysis?
The study uses a quantitative event study design, employing Analysis of Variance (ANOVA) and the Chi-square (χ2) test to evaluate the statistical significance of performance differences between regulated and deregulated periods.
What does the main body of the work cover?
It covers theoretical frameworks of pricing, an empirical review of international studies on price controls, the specific methodology for the Ghanaian market, and a data-driven trend analysis of Return-on-Equity and gross sales.
How is the financial performance of OMCs measured in this study?
Performance is measured using Return-on-Equity (ROE) percentages and annual gross sales figures from 2012 to 2019.
Which keywords best characterize the research?
Key terms include petroleum price regulation, Return-on-Equity, oil marketing companies, Ghana, Chi-square, ANOVA, and financial performance.
What specific finding does the author highlight regarding the deregulation period?
The study found that, following the deregulation of petroleum prices, there was a positive growth in the company's gross sales and an overall favorable impact on financial performance compared to the period of rigid price regulation.
Why did the researcher choose the Chi-square test for this analysis?
The Chi-square test was selected to determine if there is a statistically significant difference in financial performance distributions between the regulated and deregulated regulatory regimes.
- Arbeit zitieren
- Mohammed Issah (Autor:in), 2020, Petroleum Price Regulations on the Financial Performance of Oil Marketing Companies in Ghana, Part I, München, GRIN Verlag, https://www.grin.com/document/979621
