General News of Tuesday, 20 January 2015
The National Petroleum Authority (NPA) says it has been forced to maintain fuel prices at a 10% reduction despite decline in crude oil prices because the pass through effect on the economy is insignificant.
Chief Executive of the Authority, Moses Asagah, said previous reduction in petroleum products did not reflect in transport fares and prices of goods on the market — suggesting things will remain same when fuel prices are reduced beyond the recently announced 10% drop.
He explained: “Somewhere in November, we did a 2% reduction. We were told it wasn’t enough to reflect transport to be reduced. Then now again in December we did a 10% reduction which brought it cumulatively to 12% and by the trigger arrangement we had with GPRTU [Ghana Private Road Transport Union] they are supposed to make a reduction and they came out boldly to announce that there’s going to be a 5% reduction across board. We haven’t seen that being reflected. Ghanaians are still paying the old fares.”
Mr Asagah said what beats his mind is that even with the 12% reduction in fuel prices “all those who were agitating that NPA should reduce prices have remained quiet when the transport fares have not been reduced.”
But former Volta River Authority boss and energy consultant, Charles Wereko-Brobby says that explanation is irrelevant.
Dr Wereko-Brobby said the NPA has no legal remit over transport fares, adding the NPA must leave matters regarding transport fares to the Transport Council and the government.
“NPA like all other bodies in Ghana works by law and LI 2186 passed in 2012, which is National Petroleum Authority prescribed Petroleum Pricing Formula, sets out what should happen in petroleum price build up” Dr Wereko-Bobby pointed out.
He said the NPA must follow the dictates of the law and not which institution reduces transport fares or goods.
Dr Wereko-Brobby reminded the NPA that they “are under legal obligation to match ex-pump prices to the changes in international crude oil pricing”.
Currently, a barrel of crude sells a little below $50, but a litre of petrol is selling at Ghc3.50 at the pumps, while diesel is going for Ghc2.97.