ASEC welcomes fuel tax removal

The Africa Sustainable Energy Centre (ASEC) has welcomed the government’s decision to remove selected taxes and margins on petroleum products, describing the move as timely relief for households and the transport sector in the face rising global fuel prices.

The move, approved at an emergency Cabinet meeting on April 9m 2026, comes against the backdrop of escalating tensions in the Middle East, which have driven up crude oil prices and heightened pressure on domestic fuel costs.

In a statement issued in Accra, ASEC commended President John Dramani Mahama and his administration for what it described as a “swift and decisive” intervention, noting that the policy reflects a responsive approach to managing external economic shocks.

The Centre said unchecked fuel price increases have far-reaching implications beyond transport, including threats to food security, small business viability and overall household welfare.

The statement signed by its Executive Director, Justice Ohene-Akoto, also argued that Ghana has the fiscal space to accommodate the tax relief, citing windfall revenues from crude oil exports due to global prices exceeding the 2026 budget benchmark of US$76.22 per barrel. It described the move as consistent with sound, evidence-based fiscal management.

The organisation further praised transport unions, particularly the Ghana Private Road Transport Union (GPRTU), for exercising restraint in fare adjustments following an appeal by the President, calling it a demonstration of national solidarity.

However, ASEC stressed that while the intervention provides immediate relief, it should serve as a catalyst for deeper structural reforms within the energy sector.

The energy think-tank urged government to pursue preferential crude supply agreements with African producers such as Nigeria, the Republic of Congo and Algeria to reduce dependence on Middle Eastern sources and improve supply resilience.

“The recurring vulnerability of African nations to external oil price shocks underscores the urgent need to accelerate the transition to domestically sourced, renewable, and sustainable energy. Investments in solar, wind, and other clean energy technologies, alongside the diversification of the energy mix, remain the most durable path to insulating Ghanaian citizens from the volatility of global fossil fuel markets,” Ohene-Akoto said.

The Centre also highlighted the need to accelerate investment in renewable energy, arguing that diversification into solar, wind and other clean technologies remains the most sustainable way to shield the economy from global oil price volatility.

Among its medium-term recommendations, ASEC called for the expansion of Ghana’s strategic petroleum reserves, a review of royalty and revenue agreements with international oil companies, and stronger force majeure provisions in energy contracts to better manage supply disruptions.

For the long-term, it advocated the rehabilitation and expansion of the Tema Oil Refinery to reduce reliance on imported refined products, alongside a broader diversification of the national energy mix.

ASEC further proposed a hybrid energy transition strategy that maintains the role of oil and gas in the near-term while progressively scaling up cleaner alternatives, including investments in electric mobility infrastructure.

The Centre reaffirmed its commitment to supporting government and private sector stakeholders in advancing policies that promote energy security, affordability and sustainability.