Is Govt lying about petroleum price increases?

The Insight which has positioned itself as one of local newspapers very critical of the Kufuor administration reports that, “Pressed to provide the price structure of petrol, Mr. Albert Kan-Dapaah has disclosed that CIF value of the product is 64 per cent of the price.

He has also disclosed that excise duty/tax amounts to 24 per cent of price whiles distributor’s margins also account for 12 per cent of the price.”

Speaking on a local FM station, Mr. Kan-Dapaah (MP) gave the value of the cedi terms as CIF - ?12,800, excise duty/tax - ?4,800 and margins ?2,400. The Minister also disclosed that government based its calculations on a barrel price of US$32 calculated at a cedi rate of ?8,800 to a dollar.

“A close examination of the figures however show a huge discrepancy in the CIF values quoted by the Minister. At $32 per barrel at ?8,800 per dollar, the cost of barrel of petrol should be ?281,600.

In America, a barrel of oil translates into 42 American gallons. Therefore, using the American measurement, the real CIF value of gallon of petrol ought to be ?6,704.79 and not the figure of ?12,800 quoted by the minister. This leaves a difference of ?6,095.24 between what the minister quoted and values based on the American measurement.

In the United Kingdom, a barrel of oil also translates into 34.97 gallons giving a CIF value for a gallon of petrol at ?8,052.62. This will give a difference of ?4,747.38 between the price quoted by the minister and calculations based on the British measurements. The questions are; how did the minister arrive at the CIF value? Have we been told the whole truth?

“Other official figures obtained by the Insight tell a completely different story. The ministry of Energy’s official price structure puts the ex-refinery price of a litre of petrol at ?2,846.47.