Ghana: Oil Marketing Companies Hold Pump Prices Steady Despite Projected Increases

Oil marketing companies (OMCs) in Ghana have kept pump prices unchanged for the first pricing window of October, despite projected increases in petrol, diesel and liquefied petroleum gas (LPG) prices due to rising international petroleum product costs.

The Chamber of Oil Marketing Companies (COMAC) had projected that petrol prices would rise by between 2.12% and 3.31%, diesel by between 3.32% and 5.60%, and LPG by between 1.90% and 2.25%.

The forecasts reflected a 19.42% increase in international crude oil prices, alongside rises of 6.91% for diesel, 2.43% for petrol and 8.55% for LPG, according to the chamber. LPG recorded the largest increase among the refined products cited.

However, the chief executives of GOIL PLC and Star Oil Ghana, two leading fuel retailers, said in Facebook posts on Friday that their companies would maintain petrol and diesel prices for the first pricing window of October.

Neither explained the reason for the decision.

Speaking on Accra-based TV3 on Saturday, National Petroleum Authority (NPA) Chief Executive Godwin Edudzi Tameklo said the government, through the finance minister, had suspended the GH¢1-per-litre Energy Sector Levy on diesel for the whole of October.

He said the measure was intended to cushion consumers against rising free-on-board (FOB) prices of petroleum products.

Tema Oil Refinery and Sentuo Oil Refinery had also agreed to hold their FOB prices at levels applied during the second pricing window of September, he added.

FOB prices exclude shipping costs to the destination.

Tameklo said the decision followed instructions from the energy minister and a meeting with industry representatives, including GOIL Group Chief Executive Edward Abambire Bawa, the chairman of Sentuo Oil Refinery and representatives of the Chamber of Bulk Oil Distributors (CBOD).

The participants agreed to help keep prices stable for consumers, he said.

“Diesel alone does about 250 million litres every month. That’s GH¢250 million for just the GH¢1 levy alone. If we are doing GH¢2, that’s over GH¢480 million just on diesel.

And we sustained this for almost three months,” he said.

Tameklo said the policy debate centred on whether to pass on the full cost of fuel increases and provide targeted support for public transport, or cushion all petroleum consumers because of the downstream sector’s importance to the economy.

“Your cell sites will not work, aggregation will not work, you can’t even move anything in this country,” he said.

He described the president’s intervention as a costly decision intended to ease hardship and prevent protests and fuel queues of the kind he said had occurred in Sierra Leone, Pakistan and India.

Tameklo thanked Star Oil Ghana and GOIL PLC and bulk distributors for agreeing to maintain prices and apologised to COMAC for not fully involving the chamber before the decision was taken.

“I take full responsibility for that omission. Necessity knows no law. We felt it was ideal to mitigate the impact of rising petroleum prices to make life easier for our people,” he said.