Business News of Thursday, 31 May 2018
Fuel prices at various vending points are expected to increase up to about 3 percent in the first pricing window of June.
According to the Chamber of Petroleum Consumers-Ghana (COPEC-GH), indicative ex-refinery prices for both petrol and diesel are expected to go up by between 2-3 percent for the first window which begins on 1 June 2018.
“Pump prices for both products could be expected to rise by between 2-3 percent depending on the Oil Marketing Company (OMC), the current pump averages of 4.670 and 4.660 for Gas Oil and Gasoline respectively, given the current price movements, the two products could rise to as high as GHS 4.80/litre or GHS 21.60/ gallon, and GHS 4.78/litre or GHS 21.51/gallon for Gasoline and Gasoil respectively representing 2.783 percent and 2.55percent increases on both products respectively, ” a statement issued by COPEC-GH Executive Secretary Duncan Amoah explained on Wednesday 30 May 2018.
COPEC-GH called on government to implement measures that will cushion the public against the increments.
“We use this opportunity to encourage government on stepping up efforts at curbing the illegal fuel trade which is costing the state several hundreds of millions in revenue yearly in order to further reduce the overburdening taxes on fuel at the pumps currently.
“While Ghana might have missed the opportunity to hedge petroleum pricing whiles world prices were generally low, we still believe that option should be heavily exploited to ensure fuel prices are stabilised for the ordinary consumer whose budget on fuel keeps increasing by the weeks,” the statement added.
Below is the full statement:
CHAMBER OF PETROLEUM CONSUMERS-GHANA
FUEL PRICES GOING UP FOR FIRST WINDOW-JUNE
The first fuel pricing window under the Price Liberalization Programme of the National Petroleum Authority (NPA), for the month of June 2018, is set to commence in the next few hours.
The second window of the current month of May saw most of the Oil Marketing Companies (OMCs) increase fuel prices by about 3% at the various pumps, with average trading indexes of around 4.670/litre for petrol or gasoline and 4.660/litre for gasoil with the special or higher octane products selling at 5.230/litre.
With a price of a gallon averaging around 21.015 for PMS (petrol) and GHS 20.970 for AGO (diesel) across most pumps.
World market prices over the past two week window has seen some sharp increases in respect of both products.
Gasoline saw an increase of about 2.78% to close trading at around $753.600/metric from the previous window figures of $712.675/metric.
Gasoil or diesel saw an increase of about 2.55%, increasing from previous trading indexes of $656.675/metric to $695.175/metric representing about $38.5/metric change.
Indicative Ex-refinery prices for both products are expected to go up by between 2-3% for the first window in June
Pump prices for both products could be expected to rise by between 2-3% depending on the OMC, the current pump averages of 4.670 and 4.660 for Gas Oil and Gasoline respectively, given the current price movements, the two products could rise to as high as Ghc4.80/litre or Ghc21.60/ gallon, and Ghc4.78/litre or Ghc21.51/gallon for Gasoline and Gasoil respectively representing 2.783% and 2.55% increases on both products respectively.
Forex over the past two weeks period has also lost some marginal points to close trading at around GHS4.66/1$ from previous GHS4.56/1$, and is not expected to have much impact on eventual pricing but consumers could pay more for the marginal losses in value though it is expected not to have any serious impact on fuel prices for the coming window.
Prices of petroleum products saw a sharp increase over the period in review due to huge geopolitical shifts and uncertainties following attacks by Israel on Iran as well as a stalemate between the United States and Iran.
The new prices are expected to reflect at the pumps from Thursday the 1st of June though most OMCs indicate the adjustments will most likely reflect by Friday.
We use this opportunity to encourage Government on stepping up efforts at curbing the illegal trade fuel trade which is costing the state several hundreds of millions in revenue yearly in order to further reduce the overburdening taxes on fuel at the pumps currently.
While Ghana might have missed the opportunity to hedge petroleum pricing whiles world prices were generally low, we still believe that option should be heavily exploited to ensure fuel prices are stabilised for the ordinary consumer whose budget on fuel keeps increasing by the weeks.
We further reiterate our earlier calls on the Government through its yet to be presented mid-year budget, to further consider reviews on fuel taxes especially the Price Stabilisation and Recovery Margins as well as the repositioning of the special petroleum Tax to an ex-refinery position instead of the current fixed ex-depot position amount, or a further downwards movement from the current 13% on Ex-Depot to 10% of Ex-Refinery position as the tax levels continues to remain very high, accounting for over 51% on current ex pump prices,
Fuel prices indeed continue to remain very high across the country and we expect the Government to do anything within its powers to arrest the escalations at the pumps as any further shocks on world market prices or the forex in the coming weeks will likely have a very dire impact on prices and consumers eventually.