The Association of Oil Marketing Companies (OMCs) says its members have been compelled to reduce their margins on the sale of all petroleum products in the wake of the surge in fuel prices.
The Chief Executive Officer of the Association, Kwaku Agyemang-Duah, told the Ghana News Agency that if OMCs were to apply their full margins to cover cost of operations and profit, a litre of patrol would have been sold for ¢7.21 at the pumps.
He dismissed claims that the OMCs were benefiting from the surge in fuel prices, stressing, “Because the price is going up, we are not even thinking about profits.”
“Anytime the price goes up, you realise that people reduce their consumption and when that happens, you will not get the volumes that you are supposed to be selling.
“The pricing is such that as the price is going up, you cannot put so much of your margin on it. As we speak right now, the fuel is supposed to be ¢7.21 for petrol and ¢7.14 for diesel for our full margin,” he said.
Mr Agyemang-Duah said though the reduction had affected their profit margins, they were also concerned about the plight of consumers, hence the decision to adjust the prices not to affect patronage.
Fuel prices have been on a rise since April 2021, leading to persistent agitations among industry players and transport operators in the country.
Currently, a litre of petrol and diesel is selling at GH¢6.90 at the pumps.
As of November 19, 2021, the price of West Texas Intermediate (WTI) crude oil stood at $75.97 per barrel.
As part of measures to cushion the burden on consumers, the Government, last month, suspended the Price Stabilisation and Recovery Levy (PSRL) on petroleum products for two months, which took effect on November 1, 2021.
The levy imposed 16Gp per litre on petrol, 14Gp per litre on diesel and 14Gp per kilogramme on LPG.
However, the Institute for Energy Security (IES) has projected that fuel prices are likely to hit GH¢7.0 per litre or more by the end of the year.
It said global demand for fuel was expected to increase in the winter and that could trigger a hike in prices globally in the wake of limited supply.
The Institute said depreciation of the cedi against the dollar could also be a major catalyst in the projected increment in fuel prices.