Ghana Petroleum Revenue Declines to $399.6 Million in Second Half of 2025, Reveals Bank of Ghana

The Bank of Ghana (BoG) has released its Semi-Annual Report on the Petroleum Holding Fund (PHF), revealing a significant dip in total petroleum receipts for the second half of 2025. Total inflows amounted to US$399.65 million, a marked decrease compared to both the previous half-year and the same period in 2024. This comprehensive analysis breaks down the sources of revenue, allocations, fund performance, and the economic outlook for Ghana’s crucial petroleum sector.

Introduction: Understanding Ghana’s Petroleum Revenue Streams

Ghana’s economy relies on a structured framework to manage revenue from its offshore oil and gas resources. The cornerstone of this framework is the Petroleum Holding Fund (PHF), administered by the Bank of Ghana. The PHF collects all petroleum-related receipts—from crude oil liftings to taxes and royalties—before they are allocated to specific national accounts according to the Petroleum Revenue Management Act (PRMA). The latest BoG report for July to December 2025 provides a critical snapshot of performance, highlighting challenges from volatile oil prices and production. This report is essential for policymakers, investors, and citizens tracking the management of Ghana’s non-renewable resource wealth.

Key Points: At a Glance

• Total Receipts Drop: Petroleum inflows fell to US$399.65 million in H2 2025, down significantly from H2 2024.
• Revenue Composition: Inflows comprised US$198.25 million from crude oil liftings and US$201.40 million from taxes and interest.
• Allocation Exceeds Receipts: Total allocations of US$493.40 million were funded by drawing on accumulated PHF balances from prior periods.
• Major Beneficiaries: The Annual Budget Funding Amount (ABFA) received US$285.06 million. The Ghana Stabilisation Fund and Ghana Heritage Fund got US$115.99 million and US$49.71 million respectively.
• Fund Performance: The Ghana Petroleum Funds (Stabilisation & Heritage) posted a positive net realised return of US$28.11 million.
• 2026 Outlook Cautious: Declining Brent crude prices and geopolitical risks point to moderated oil revenue expectations for 2026.

Background: The Petroleum Holding Fund and Management Framework

The Role of the Petroleum Holding Fund (PHF)

Established under the PRMA, the PHF serves as the single account where all petroleum revenues—including royalties, taxes, surface rentals, and proceeds from oil liftings—are first deposited. The Bank of Ghana, as the fiscal agent, manages this fund. Its transparent reporting is a key governance tool aimed at preventing misappropriation and ensuring revenues are saved, stabilised, or spent according to law.

Key Allocation Rules (PRMA)

The PRMA mandates a specific formula for distributing PHF balances each quarter:

1. Annual Budget Funding Amount (ABFA): Up to 70% of the “benchmark revenue” is allocated to fund national budget priorities, typically infrastructure and social programmes.
2. Ghana Stabilisation Fund (GSF): Receives a share (currently 20% of benchmark revenue) to smooth fiscal spending during periods of revenue shortfall.
3. Ghana Heritage Fund (GHF): An intergenerational savings fund (currently 10% of benchmark revenue) for future generations when oil reserves are depleted.
4. GNPC Carry & Participation: The Ghana National Petroleum Corporation receives its equity financing entitlements for participating in oil fields.

The “benchmark revenue” is calculated based on a long-term oil price assumption (currently around US$65 per barrel) and production forecasts. Actual revenues can deviate significantly, leading to draws from or additions to the stabilisation and heritage funds.

Analysis of the H2 2025 Report

Revenue Inflows: A Two-Pronged Decline

The total receipt of US$399.65 million represents a substantial reduction. For context, the report notes this figure is lower than the US$369.25 million earned solely from crude oil liftings in H2 2024. This indicates a compounded decline: both the volume/value of oil lifted and the associated tax revenues fell.

Detailed Breakdown of Receipts

The inflows originated from two main categories:

1. Crude Oil Liftings (US$198.25 million): This came from the lifting of two cargoes from the Jubilee field and one cargo from the Sankofa Gye Nyame (SGN) field by the “Ghana Group,” represented by GNPC. This is a direct physical sale of the country’s share of production.
2. Petroleum Taxes & Interest (US$201.40 million): This consists of:
   • Corporate Income Taxes: US$198.09 million from oil companies.
   • Interest on PHF Balances: US$3.31 million earned on the fund’s investments.

Notable Omission: The report specifies that proceeds from the 25th lifting from the TEN field, valued at US$60.79 million and expected in November 2025, were not received until after the reporting period (year-end). This timing issue further suppressed the H2 2025 total.

Allocation of Funds: Drawing on Savings

Despite lower inflows, total allocations for the period were US$493.40 million. The difference of nearly US$94 million was financed by utilising accumulated cash balances in the PHF from previous high-revenue periods. This demonstrates the stabilising function of the fund system in action.

• ABFA (US$285.06 million): Funding for government budget programmes.
• Ghana Stabilisation Fund (US$115.99 million): Bolstering the buffer against future revenue shocks.
• Ghana Heritage Fund (US$49.71 million): Long-term savings for future generations.
• GNPC Carry & Participation (US$42.63 million): To cover GNPC’s equity costs in production sharing agreements.

Performance of Petroleum Savings Funds

The report provides positive news on investment performance. The combined Ghana Petroleum Funds (which hold the GSF and GHF monies) generated a net realised return of US$28.11 million for the period.

• Ghana Heritage Fund Return: 2.28%
• Ghana Stabilisation Fund Return: 2.51%

These returns, while modest, are crucial for growing the real value of savings over the long term, countering inflation, and building the intergenerational equity envisioned by the PRMA.

Total Petroleum Reserves (as of Dec 31, 2025)

The cumulative value of all funds under the PHF framework stood at approximately US$1.55 billion.

• Ghana Heritage Fund: ~US$1.38 billion (the larger, long-term savings component).
• Ghana Stabilisation Fund: The remainder, used for fiscal smoothing.

Practical Advice: Interpreting the Data and Looking Ahead

For Policymakers and Economists

This report underscores the inherent volatility of petroleum-based fiscal planning. The need to rely on accumulated balances to meet H2 2025 allocations highlights the importance of:

1. Conservative Benchmark Oil Price: Ensuring the long-term price assumption in the PRMA formula is not overly optimistic to prevent over-spending of ABFA during lean periods.
2. Strengthening the Stabilisation Fund: The GSF’s role as a fiscal buffer is validated. Rules for its withdrawal during deficits should be strictly followed.
3. Diversification Urgency: Over-reliance on volatile commodity revenues remains a macroeconomic risk. Revenue diversification must be accelerated.

For Investors and the Private Sector

The decline in liftings and taxes may signal production challenges or scheduled maintenance at key fields (Jubilee, TEN, SGN). Investors should monitor:

• Production Reports: From the Jubilee field partners (Tullow, Kosmos, etc.) and the SGN field (ENI, Vitol, GNPC).
• Government Fiscal Stability: The ability to meet budget obligations despite oil revenue dips, potentially impacting broader economic stability and debt sustainability.
• GNPC’s Financial Health: GNPC’s receipt of its carry financing is critical for its operational capacity and partnership roles.

For Civil Society and the Public

Transparency is the first step to accountability. Citizens can use this BoG report to:

• Track ABFA Spending: Follow up on the US$285.06 million allocated. Which specific infrastructure or social programmes were funded? The Ministry of Finance should publish a detailed expenditure tracker.
• Monitor Heritage Fund Growth: The US$1.38 billion Heritage Fund is a national asset for future generations. Its investment strategy and value should be publicly scrutinised.
• Question Revenue Volatility: Why did revenue drop so sharply? Is it due to global prices, local production issues, or both? Advocacy for robust local content and environmental regulations is key.

FAQ: Frequently Asked Questions on Ghana’s Petroleum Revenue

What is the Petroleum Holding Fund (PHF)?

The PHF is a consolidated account held at the Bank of Ghana where all revenues from Ghana’s petroleum sector are first deposited before being allocated to the Annual Budget Funding Amount (ABFA), the Ghana Stabilisation Fund, the Ghana Heritage Fund, and the Ghana National Petroleum Corporation (GNPC) as per the Petroleum Revenue Management Act.

Why did petroleum revenue fall in H2 2025?

The decline was due to a combination of factors: lower volumes/value of crude oil lifted from the Jubilee and Sankofa Gye Nyame fields, the postponement of a major TEN field lifting to 2026, and likely lower global oil prices in the period. Corporate tax revenues also fell in tandem with lower profits.

What is the difference between ABFA, the Stabilisation Fund, and the Heritage Fund?

• ABFA: Funds the national budget, primarily for public investment and priority expenditures.
• Stabilisation Fund: Saves excess revenue in good times to finance budget deficits during periods of low petroleum revenue, stabilising government spending.
• Heritage Fund: A permanent savings fund for future generations after oil reserves are depleted. It is not to be drawn down for current spending.

How reliable is the Bank of Ghana’s data on petroleum revenue?

The BoG’s PHF reports are considered the official, audited source for petroleum revenue data in Ghana. They are produced semi-annually and are a key transparency mechanism under the PRMA. However, the timing of specific liftings (like the TEN cargo) can cause quarterly fluctuations.

What is the outlook for 2026?

The BoG report adopts a cautious outlook. It notes that Brent crude prices declined from US$66.61 to US$60.81 per barrel by the end of 2025. The International Monetary Fund (IMF) projects global growth of 3.3%, but warns that Ghana’s revenues remain vulnerable to OPEC+ production decisions and Middle East geopolitics. The BoG’s implied forecast for 2026 is an average oil price of approximately US$62.13 per barrel, which is below historical averages and suggests continued revenue pressure unless production increases significantly.

Conclusion: Navigating Volatility Through Prudent Management

The Bank of Ghana’s H2 2025 report paints a clear picture of a sector subject to the relentless forces of global commodity markets and operational schedules. The drop to US$399.65 million in receipts is a stark reminder that petroleum wealth is not a constant stream but a volatile one. The fact that allocations still reached US$493.40 million by drawing on past savings is a testament to the intended function of the multi-fund system—providing stability when revenues falter.

Looking ahead, the cautious 2026 forecast, anchored by an expected average oil price of US$62.13 per barrel, suggests that fiscal planners must budget prudently. The positive performance of the Ghana Petroleum Funds (2.28%-2.51% returns) offers a silver lining, demonstrating that the saved capital can work to grow the nation’s asset base even when new inflows are weak.

The ultimate test for Ghana remains the disciplined execution of the Petroleum Revenue Management Act. Continued transparency through BoG reports, rigorous parliamentary oversight of ABFA spending, and steadfast adherence to the savings rules for the Stabilisation and Heritage Funds are non-negotiable. Only through such disciplined management can Ghana transform its finite oil resources into lasting economic development and intergenerational equity.