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Friday, August 19, 2022

Petroleum Prices Up Again

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Alex Mould – CEO of National Petroleum Authority

The National Petroleum Authority (NPA) has announced increments in the prices of petroleum products saying it was necessitated by “the rising world prices and depreciation of the Cedi”.

A statement issued in Accra and signed by Alex Mould, Acting CEO of NPA, said the new prices take effect from December 29.

According to the statement, the prices of petrol and diesel will go up by 15 per cent each at GHp 175.48 per litre and GHp 177.09 per litre respectively while LPG will go up by 30 per cent at GHp 136.19 per kilo.

With this breakdown, a 12.5 kg cylinder will now sell at GHc17.02 while a 14.5 kg cylinder will sell at GHc19.75.

The prices of kerosene, premix fuel and Renewable Fuel Oil (RFO) remain unchanged.

Kerosene will continue to sell at GHp 91.00 per litre, premix fuel at GHp 54.27 litre and Renewable Fuel Oil (RFO) at GHp 83.93.

“The NPA will be monitoring the international prices and intends not to decrease or increase petroleum products pump prices if the average prices of crude oil consistently remain within the USD107/barrel to USD111/barrel range,” the statement said.

It said the NPA would continue with its bi-weekly review of the international prices to ensure that the suppliers of petroleum products were paid the full cost recovery price using import parity.

Giving a background to the increases, the NPA said in January 2011, it announced petroleum products pump prices based on prevailing international crude oil and petroleum prices at the time – crude oil price (Brent Crude) was at USD92/barrel, and the exchange rate was at GHC1.4629 per USD1.00.

It noted that the average per barrel price of crude oil for 2011 was USD111 with current prices at USD110, which was approximately a 20 per cent increase since the last petroleum products pump price review when crude oil prices were at USD92/barrel.

“Also, the current exchange rate is at GHc1.5464/USD which implies the Cedi has depreciated by about 5.7 per cent since January 4th, 2011.”

NPA said the culminating effect of international crude price movements and depreciation of the Cedi implied an over 25 per cent increase (in Ghana Cedi terms) in the cost of procuring crude oil and petroleum products since January 4, 2011.

“By the end of 2011, the government of Ghana would spend over GHc450 million in subsidies for the 2011 year.”

The NPA said the current situation of crude oil prices being currently at USD110/barrel and the exchange rate of GHc1.5464/USD therefore calls for the price hikes.

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