The National Petroleum Authority (NPA) today, November 2 held a press conference to respond to issues around Residual Fuel Oil (RFO) and the subsidy that has been taken off.
Explaining the genesis of the subsidy which started in 2015, Head of Economic Regulation at the NPA, Abass Tasunti said current happenings have somewhat choked the account so it has to be taken off because the subsidy affects the supply.
According to him, Companies who offer the product are refusing due to delayed payments and therefore want removal of the subsidy for now.
"It has become unsustainable so we have to remove it for the companies to have access to the product," Abass said.
He noted that the revenue from the price stabilisation and recovery levy will focus on premix
He added that RFO is used by manufacturing industry and the removal of subsidy won't impact fuel being sold at the pumps
Subsidy accumulated on RFO from January to September is Ghc 154m.
The NPA on Monday, November 1 suspended the subsidy on RFO..
In a statement signed by its Chief Executive Officer, Dr Mustapha Abdul-Hamid, it said the suspension of the policy to subsidize RFO is in line with the directive from the Ministry of Energy as an interim measure to ease the financial burden on the Price Stabilisation and Recovery Account (PSRA).
“The suspension of the policy to subsidise RFO is in line with the directive from the Ministry of Energy as an interim measure to ease the financial burden on the Price Stabilisation and Recovery Account (PSRA)”.
“The policy directive takes into consideration the growing concern about the sustainability of the Account to meet under-recovery payment obligations for Premix Fuel and RFO”, it added.
