COPEC asks for 10% reduction in fuel prices

The Chamber of Petroleum Consumers-Ghana (COPEC) is asking government to consider a 10 percent reduction in fuel prices to curtail possible upsurge in the second window beginning March 15.

COPEC asserted that the PURC’s proposed tariff cut will only have the maximum impact on Ghanaians if government reduces fuel prices to coincide with the new tariff as a possible increase in the price of fuel in the second window looms.

At a media encounter, organized by the Chamber of Bulk Oil Distributors (CBOD) in Accra, COPEC’s Executive Secretary, Duncan Amoah said, “The announcement by the PURC for the reductions in electricity tariff by 17.5 percent to residential consumers and 30 percent non-residential, as well as, a special load cut by 25 percent and the Mines by 10 percent effective March 15, 2018, is a welcoming news.”

He however, told the Goldstreet Business that, the cuts, would introduce a phenomenon of ‘robbing Peter to pay Paul’ should government remain adamant on reducing the prices of fuel immediately.

“The last check we did is that prices are going up because of the extreme winter condition across Europe and other parts of the world, and we would soon experience the effect here” Amoah explained.

As a result of a demonstration by COPEC against fuel prices last month, government offered a two percent cut on the Special Petroleum Tax (SPT).

But COPEC, this time, according to Amoah, wants at least a 10 percent reduction, describing the  two percent as not enough and the SPT as a nuisance and avoidable in the face of rising prices in the world market.

The proposed utility cut announcement from March 15, Amoah explained, gives the indication that government has the capability of reducing fuel prices which could go a long way to ease some burden on the Ghanaian.

“It is a balancing act. If you reduce utility and fuel prices go up, what you are seeking to give to industry would be knocked out on the other front because most industries may have the need for petroleum products and so the stimulus that the tariff cuts would offer, will automatically be erased by fuel price hike.  A minimum 10 percent extra reduction will be good for everyone’s pocket” Amoah said.

Meanwhile, CBOD’s CEO, Senyo Hosi, explained that deregulation in the petroleum sector has brought some respite to government, as massive debts were generated under the regulated regime.

“About US$5 billion was lost in the four years, under the regulated regime by 2015, as government bore most of the risks involved. But operators will not see deregulation as good because this time, they bear their own risk. But we policy makers [CBOD] considers deregulation as one of the best things that has happened to this country,” Hosi said.

By Wisdom Jonny-Nuekpe