Impending fuel price hike not the function of govt – COPEC

The Chamber of Petroleum Consumers Ghana (COPEC Ghana), has noted that government has no hands in the impending fuel price increment.

Executive Director of COPEC, Duncan Amoah explained that the external factors that are beyond the control of government are to blame for the hike.

Fuel prices are expected to go up on Monday following the 23.25% surge in price of Brent crude oil, in addition to the 41.80% and 22.68% significant rise in the prices of Gasoline and Gasoil respectively on the international market, the Institute for Energy Security said on Friday.

“Going by the 23.25% surge in price of Brent crude oil, in addition to the 41.80% and 22.68% significant rise in the prices of Gasoline and Gasoil respectively on the international market; the Institute for Energy Security (IES) foresees prices of fuel on the domestic market going up, and above April 2020 levels,” it said.

It added that, “The marginal depreciation of the local currency would also be another determinant for the Bulk Distribution Companies (BDCs) in selling to the OMCs, and that would definitely reflect at the pump.”

A litre each of petrol and diesel is currently sold for 4 cedis 6 pesewas on the average.

For the last pricing window, “Shell (Vivo), Total, Goil, Allied Oil, Star Oil, Petrosol and Puma Energy joined other Oil Marketing Companies (OMCs) to maintain prices at the pump,” the statement said.

“Due to the marginal increase in the prices of oil and fuel on the international market in the first Pricing-window of May 2020, prices of petroleum products on the local market remained largely unchanged within the Pricing-window under review,” IES added.

According to the IES, “Brent crude price moved above the $30 per barrel mark for the Pricing-window under assessment. The crude price recovery is coming on the back of rebound in demand for crude products such as gasoline, gasoil, jet fuel.”

“This positive gain can be attributed to the easing of restrictions in economic activities around the world, and the cutback in production by the OPEC+.”

IES concluded that, “following this, Brent crude price appreciated by 23.25% from $27.36 per barrel recorded at the end of the first Pricing-window of May to close at $33.72 per barrel on average terms at end of the second Pricing-window.”

“Gasoline and Gasoil prices as monitored on Standard and Poor’s global Platts platform shows significant surge. While Gasoline went up by a whopping 41.8% to close the window at $287.65 per metric tonne on average terms, Gasoil price rose by a significant 22.7% to close trading at $264.83 per metric tonne,” it added.

Speaking on this matter on TV3 Saturday May 30, Mr Duncan Amoah said : The understanding we are getting is that effective Monday almost every OMC would have gone up on their prices between 5 to 8 per cent.

“We will want to ask the public to take advantage of the period between now and Monday to fuel up because it is likely they will be paying more for fuel.

“These increases are not a function of government because taxes have not gone up, the cedi seems to be losing quite some ground over the period largely due to international market differences.

“And so, in as much as we would have wished to pay lower for fuel these are understandable dynamics. The only caution we will draw to the OMCs is that they shouldn’t increase it so huge, just stagger it piece meal for all of us like they did when the prices were coming down.”