Audio By Carbonatix
The CEO of the National Petroleum Authority (NPA), Godwin Edudzi Tamakloe, says the international price of diesel has almost doubled since February, but Ghanaian consumers have been shielded from the full impact.
His comments come as fuel prices continue to rise at the pump amid renewed pressure on international petroleum prices.
The NPA increased the minimum price floor for diesel from GH¢15.60 to GH¢16.77 per litre from September 16. Some Oil Marketing Companies have since raised their prices, with Star Oil pricing diesel at GH¢17.77 per litre.
Speaking on Joy News’ PM Express Business Edition on Thursday, Mr Tamakloe said the cost of diesel on the international market has increased sharply since February.
He attributed the relatively lower increase at Ghanaian pumps to the stability of the cedi and deliberate government intervention.
He said economic managers, including the Gold Board, the Bank of Ghana and the Finance Ministry, had worked together to support the currency.
“Now, when it comes to the tax component, the taxes have remained relatively, you know, constant over the period, relatively.”
According to him, the biggest pressure has come from the international Free On Board (FOB) price of diesel.
“And I’ll give you a classic example: By February 28th, prior to the US launching the attack on Iran, the joint, you know, strike between Israel and the US, a metric ton of diesel, okay, was trading for $794.”
He said the supplier’s premium was then about $50, covering factors including vessel availability and insurance.
“The supplier’s premium, which obviously is a combination of many a factor: vessel availability, insurance, and all of those things, was about $50.”
Mr Tamakloe said the situation has changed dramatically, with the same quantity of diesel now costing $1,519.
“Today, as we speak, the same metric ton is going for $1,519.”
He said the increase amounts to almost a doubling of the international price.
“Now, from 794 to $1,519, that’s almost twice the price, a 100% increase.”
Ordinarily, he said, such a jump would have translated into a comparable increase at Ghanaian fuel stations.
“Ordinarily, one would expect that petroleum prices at the pump should be increasing by the same 100%.”
However, he said the impact has been moderated by the stronger cedi and government measures to cushion consumers.
“But you’d notice that the culmination of the exchange rate stability and government deliberate intervention to cushion the impact is what has brought greater relief to our people.”
Mr Tamakloe also compared Ghana’s experience with developments elsewhere, saying the country had managed the situation better than some other jurisdictions.
“And let me say this: Look, George, if you look at the dynamics now, compared to other countries, you’ll notice that Ghana here, we have managed the situation far, far better.”
He cited unrest in Syria over rising fuel prices and said the United States had also recorded a significant increase in diesel prices.
“Even mighty America has seen the highest increase in the price of diesel ever seen.”
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