The government has directed the Finance and Energy Ministers to remove some taxes and margins on fuel to bring down prices at the pump, with the relief expected to take effect at the next pricing window, approximately one week away.
The announcement came on Thursday after an emergency cabinet session convened specifically to assess the impact of rising global fuel prices on Ghanaians, following weeks of increases driven by the ongoing US-Israel-Iran conflict.
The Minister of State in charge of Government Communications, Felix Kwakye Ofosu, who briefed the press after the session, said cabinet had been monitoring developments closely and concluded that action could no longer be delayed.
“Cabinet has decided that the finance and energy ministers should take immediate steps to reduce the price of fuel through the removal of some taxes and margins on fuel, effective the next pricing window,” he said.
The increases at the pump, he explained, were directly linked to restrictions in the Strait of Hormuz caused by the conflict, a waterway through which about 20 percent of global crude oil passes.
Those restrictions have driven up crude oil prices and triggered a significant rise in shipping insurance premiums and other related costs, all of which have fed through to Ghanaian consumers over the last two pricing windows.
Cabinet noted, however, that Ghana’s recent economic gains had helped soften the blow.
The cedi’s appreciation and stability, alongside inflation declining to around 3.2 percent, meant that despite the global pressures, fuel prices in Ghana were still significantly lower than they were during a comparable period in 2022 when the Ukraine conflict broke out.
Still, the minister said the recent increases had reached a point that demanded intervention.
“If not checked, [the increases] could spill over into general price increments in transportation and other such commodities, which then can have an effect on the cost of living,” he warned.