William Owuraku Aidoo, a Deputy Minister of Energy has said that the recent surge in prices of petroleum products in the country is due to the conflict in Eastern Europe.
He said the war between Ukraine and Russia is the main reason why fuel prices are incessantly going up in Ghana.
Addressing lawmakers in Parliament, Mr. Aidoo said the government’s hands are tied in intervening because of the deregulatory regime.
“Sanctions and boycotts on petroleum exports from Russia, a major exporter especially to Europe, are reducing availability even further and intensifying upward pressure on fuel prices. Under the current deregulated regime in Ghana where govenrment is not responsible for determining the prices of petroleum products, prices on the global market and the depreciation of the Ghana cedi against the US dollar are passed on directly to the end-consumer,” he said.
From today, June 16th, fuel prices are expected to surge between 11% and 13% all over the country. According to a news report by Joy Business, a litre of diesel is expected to go up by 11.14%, while petrol will sell at 13%.
Data from the Bulk Oil Distribution Companies further indicate that even though crude oil price has been stable on the world market, the cost of refining the products is going up.
This situation means that Oil Marketing Companies (OMCs) are likely to increase fuel prices on the market.
However, from what happened during the last pricing window, some OMCs had to renegotiate with the BDCs to reduce their prices.
This situation may occur again and therefore the margin of increment will reduce.
Meanwhile, any increment in fuel prices could force commercial transport operators to increase their fares, and this consequently will lead to an increase rate of inflation and cost of living.
Petrol is currently being sold on the market for about ¢10.10 per litre, whereas diesel is going for ¢12.20.