The earliest possible review of fuel prices will be on March 16 at the opening of the next pricing window, the Energy Ministry has said.
Offering some assurances, the Head of Communications and Public Affairs at the Energy Ministry, Nana Damoah said: “there will be some significant reduction on the prices of fuel at the pump” when the window opens.
This wait till March 16 is in line with Ghana’s deregulation policy, Mr. Damoah, explained to Citi News.
“We can only review prices over two weeks. The next pricing window opens up on the 16th of March 2020. The government, therefore, cannot intervene at this point to cause a reduction in prices against the stated policy of deregulation.”
The Ministry’s comments are in response to calls for a reduction in fuel prices by, among others, the Chamber of Petroleum Consumers (COPEC) and the National Democratic Congress after oil prices saw their lowest drop since 1991 on Monday.
The NDC wants the government to ensure fuel prices are reduced by a minimum of 20%.
COPEC is also considering legal action to compel Oil Marketing Companies in the country to reduce fuel prices.
Monday’s 23% decline saw oil prices go under $35 a barrel.
There has been a decline in demand because of the novel coronavirus and a row between Russia and Saudi Arabia.
Saudi Arabia slashed the cost of oil over the weekend after it failed to convince Russia on Friday to commit to steep production cuts.
In the meantime, he said the government was still wary of market volatilities and that “consultations are ongoing.”
About Ghana’s deregulation policy
Ghana in June 2015 put in place a deregulation policy to allow marketers and importers of petroleum products to set their own prices based on import parity costs, taxes and margins.
The deregulation policy allows Oil Marketing Companies to fix their own prices, in an attempt to introduce competition to the ultimate benefit and protection of the consumer.
But critics of the policy have said all the benefits accrued from deregulation have been in favour of the government and not citizens.
The policy was also meant to end government subsidies on these products, which arise from exchange rate losses and consumer subsidies.