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Business News Thu, 3 Jun 2021

Oil Marketing Companies can’t fix fuel prices higher than NPA’s schedule

The Association of Oil Marketing Company (AOMC) has disclosed that Oil Marketing Companies (OMCs) cannot fix fuel prices higher than the scheduled price build-up from the National Petroleum Authority (NPA) under the deregulation policy.

Executive Director of the AOMC, Kwaku Agyemang-Duah said there was a scheduled price build-up from the NPA, which they could not depart from adding that it was to prevent them from making unnecessary profit and taking the customers for granted.

He added that “there is a scheduled price build-up which you cannot depart from; this contains the ex-refinery price, the wholesale price, taxes and levies, and the OMC margins, this then becomes the price”.

Mr Agyemang-Duah who is also the AOMC Industry Coordinator stated at the third, “End of Month Stakeholder Engagement and Workers Appreciation Day,” organized by the Ghana News Agency Tema Regional Office to address national issues.

The event also served as a motivational mechanism to recognize the editorial contribution of reporters towards national development in and growth and promotion of the Tema GNA as the industrial news hub.

Speaking on: “Six years after petroleum price deregulation: analysis of impact on OMC’s and the economy,” he said those composites in the pricing was responsible for the current fuel prices differences per litter at the Filling Stations.

He noted that deregulations was introduced six years ago to help stabilize fuel prices as prior to that Ghanaians were inundated with hikes in petroleum products including; diesel and petrol prices.

The NPA, he stated, until 2015 was in charge of fuel pricing which under the deregulation now falls under the mandates of the OMCs who import and price the fuels with the NPA doing monitoring of their operations by setting price ceilings for them to work within.

He said until June 2015 when fuel prices were completely deregulated and managed by Bulk Distribution Companies (BDCs) and the OMCs under the supervision of the NPA, the pricing of petroleum products evolved through many processes including; the introduction of automatic price setting which did not work out.

Mr Agyeman-Duah said the deregulation also aimed at reducing the huge debts government owed the OMCs in its attempt to subsidize fuel prices which resulted in depriving the OMCs the capital needed for effective and sustainable business operations.

He said though at that time citizens were enjoying the subsidies on fuel, government was unable to pay the BDCs leading to shortages of the products as vessels were not supplying due to the lack of funds to pre-finance its delivery.

He said that led to discussions to deregulate and the introduction of the Energy Sector Levies Act (ESLA) to help defray the subsidy debts and its other related arrears.

The third edition of the GNA-Tema monthly stakeholder engagement was attended by the National Commission for Civic Education, the Tema Ghana Police Service, the Ghana Ports and Harbours Authority and the Association of Marketing Companies (AOMCs).
Source: GNA
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