Business News of 2014-08-19

Fuel shortage threatens national security

Interest groups in Ghana’s petroleum sector say challenges in the supply of products could threaten the security of the country.

Government’s inability to honour its financial obligations to the Bulk Oil Distribution Companies (BDCs) and the inability of commercial banks to facilitate the process, have resulted in shortfalls in the supply of petroleum products.

Most fuel stations are presently unable to access ordered quantities of diesel and premix fuel to meet market demands. In recent times, petrol has also been in short supply because the BDCs are not supplying.

Coupled with hikes in utility prices, the operators of fuel stations say they are challenged in breaking even, making the business of petroleum retailing unattractive.

According to the Petroleum Retailers Association, members are tempted to lay off workers in order to survive the impact of inconsistent and inadequate supplies of petroleum products.

Secretary for the Northern Sector of the Association, Sammy Amett says the inability to lift supplies increases the cost of borrowing from the banks as the businesses have to pay high interest on credit facilities.

He is particularly worried at the security implications when companies can’t get the services of bullion vans to move their cash from business premises to the banks.

“It gives a field day for miscreants in the society that money may be sitting somewhere, so security wise we are in danger,” he observed. “The moment the driver can’t move to the hinterland to pick food, people get hungry in the city; the banks cannot work if they can’t get fuel to power the generator when we have power outages.”

The retailers are sometimes accused of hoarding products to sell at unapproved prices to consumers.

But a fuel station manager, Anthony Kwamena Ammissah says the dealers can sell what is available though often refuse to serve late night due to security concerns.

Other stations also seek to first serve their regular customers in difficult times.

Mr. Amett believes it’s high time the government paid serious attention to revamping the Tema Oil Refinery to service the needs of the West African sub-region.

“It is very sad that at the advent of oil discovery in Ghana, we can’t refine our share and serve the sub-region. When they were formulating the policies, were they not able to foresee this kind of situation?” he queried.

Source: myjoyonline.com
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