Prime News Ghana

OMCs corroborate COPEC’s prediction that fuel prices will soon go up again

By George Nyavor
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Oil marketing companies in Ghana have indicated that fuel prices will soon go up, corroborating an earlier prediction by the Chamber of Petroleum Consumers Ghana last week.

Chief Executive of the Association of Oil Marketing Companies, Kwaku Agyemang Duah, has told Joy Business that oil marketers have already presented documents on their intended price increases to the regulator, the National Petroleum Authority (NPA).

“Normally when the window changes – it is all a strategy – some people’s strategy is to wait and see who is going to go first and when one of them goes first, the other start evaluating whether it is good enough for me to get in.

“But invariably people have submitted their documents to the about the maximum price that they are going to go…I am sure by Wednesday you will see the prices going up,” he said.

Even though he admits that fuel prices were just reviewed upwards, he noted that oil marketers must recoup huge investments they have made to get the commodity to the pumps.

Last week, COPEC Executive Secretary, Duncan Amoah, released a statement detailing reasons for the imminent increases.

The COPEC executive explained in the statement issued on Sunday, May 16 that petrol and diesel prices will soon go up in Ghana because of ongoing geopolitical events, and the fact that the international market price for petrol has moved from $630.525/mt to $655.625/mt.

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The release explained that for Automotive Gas Oil (AGO) or diesel, the prices have moved to $545/Mt from $520/Mt. LPG has also seen a little over $1.6377 increase within the period.

“These increases on the international market translate to around Ghp8 per litre on local pump prices for both petrol and diesel or around 5% on international price index, representing a further increase of about 1.25% variance on current pump prices,” the statement explained.

This prediction of an imminent fuel price increase has gotten Ghanaians talking because just weeks ago, prices at the pumps went up by 12% due to new taxes and increases in margins set by the NPA.

Fuel price increases in Ghana have a direct consequence on the cost of living and cost of production in the country, and many fear that another increase will worsen the already dire economic situation of individuals and businesses.

Meanwhile, Board Chairman of the Association of Oil Marketing Companies, Henry Akwaboah, is reported to have dispelled fears of an imminent fuel price increase.

According to Mr Citi Business, Mr Akwaboah said “even though prices on the world oil markets have gone up slightly, I do not foresee oil marketing companies increasing their prices during this window. At least I am not picking those signals for now.”

But according to the report, Mr Akwaboah admitted that oil marketing is a deregulated venture and players are at liberty to determine their prices in a way that makes full cost recovery possible.