The Executive Director of the African Centre for Energy Policy (ACEP), Dr Mohammed Amin Adam, has described the reduction in the prices of petroleum products as “inadequate and problematic”.
Dr Adam is consequently demanding a further and immediate reduction in the prices of petroleum products because the taxes and margins have not increased.
“The only changes are the appreciation of the cedi and the reduction of prices in the international market. Thus, the current prices are not corresponding with the gains made,” he said.
OMCs on Thursday, July 16, 2015, reduced fuel prices between 11 and 15 per cent, but Dr Adam insists that the figures are way below the drop in crude oil prices and the rate at which the cedi was appreciating.
OMCsAccording to Dr Adam, the reductions should have gone beyond 17 per cent.
He was of the firm conviction that the OMCs were shortchanging Ghanaians and wondered what the National Petroleum Authority (NPA) was doing to protect the consumer.
The essence of the deregulation exercise, Dr Adam said, was to promote competition in the downstream petroleum industry but noted that “it appears the OMCs are pocketing their profits, to the detriment of the consumer”.
“This trend cannot continue because it will erase public confidence in the downstream petroleum industry,” he said.
He reminded the NPA of its duty to ensure sanity on the market and urged it to look into the prices quoted by the OMCs and act decisively if the OMCs were found to have manipulated the prices.
“The consumer can also take civil remedies to ensure OMCs act in accordance with laid-down procedures,” Dr Adam noted.
Press ConferenceAt a press conference organised in Accra yesterday, Dr Adam said “with the cedi appreciating against the US dollar, there is no justification for OMCs to take advantage of the deregulation policy to increase it”.
“It is, therefore, totally wrong for them to deny consumers their rights over the appropriate reduction in the prices of petroleum products. This only shows that OMCs are exploiting consumers to satisfy their thirst for profiteering.
“Some OMCs are claiming that they are selling old stock of petroleum products which they bought at relatively higher prices. One wonders if they will make the same argument assuming the price indicators demanded an upward adjustment in product prices.
“What is more important is for consumers to know that the best regulator of the market is the consumer himself. Based on available data, particularly data for the computation of the ex-refinery price, which the Ghana Chamber of Bulk Oil Distributors (CBOD) is now publishing, we can all monitor prices of products and demand that justice is done to consumers as the petroleum deregulation policy enters its full force,” he said.
Price WarMeanwhile, there is a raging disagreement over the pricing of petroleum products between wholesalers and retailers of the products.
While the Ghana Chamber of Bulk Oil Distributors (CBOB) has given an indicative price reduction of 26.26 per cent on premium, gas oil, Liquefied Petroleum Product (LPG) and Kerosene, the OMCs have reduced prices between 11 and 15 per cent.
The CBOD on Thursday, July 16, 2016 released an outlook of indicative prices for petroleum products for the next one week to the media, using world market prices for finished products but the Association of Oil Marketing Companies (AOMCs) says such a projection is not achievable.
The Chief Executive Officer (CEO) of the AOMCs, Mr Kwaku Agyemang-Duah, told the Daily Graphic that it was impossible for his members to implement the CBOD indicative figures.
“Petroleum products are laden with so many taxes, it is virtually impossible to sell at 100 per cent less even if world market prices drop by 100 per cent,” Mr Agyemang-Duah noted.
According to him, returns for his members are far less than the taxes they pay on products.
CBOD Market UpdateThe CBOD market update is a public interest service rendered by the CBOD to keep the public and consumers abreast of trends and key events within the petroleum downstream industry.
Under the new regime, the window review of products would be published on a weekly basis.
Meanwhile, the CBOD on Wednesday, July 15, 2016 launched its Petroleum Price Indicators to give the public access to information on petroleum pricing and trends.
According to the CEO of the CBOD, Mr Senyo Hosi, the move was aimed at promoting transparency in the petroleum downstream sector.