The government has extended the GH¢2 per litre reduction in the regulatory margin on diesel for another pricing window in September, in a move aimed at protecting consumers from the impact of rising petroleum prices in Ghana.
The decision is expected to provide some relief to motorists, commercial transport operators, businesses and households, amid concerns that fuel prices could increase at the pumps from the first pricing window of September.
The GH¢2 per litre reduction was initially introduced as a temporary intervention covering two pricing windows and was expected to end at the close of August. However, the government has decided to maintain the reduction for at least the next pricing window.
This means the full GH¢2 per litre regulatory margin will not immediately be restored to diesel prices, helping to limit the extent of any potential increase in the pump price of diesel in Ghana.
The intervention comes at a time when diesel is already selling at approximately GH¢17 per litre at several Oil Marketing Companies (OMCs) across the country.
The Chamber of Petroleum Consumers (COPEC) had previously called on the government to extend the reduction, warning that allowing the measure to expire could push diesel prices towards GH¢20 per litre.
COPEC Executive Secretary Duncan Amoah said extending the intervention would help protect consumers against the expected increase in petroleum prices.
He explained that the government had initially planned to maintain the reduction for only two pricing windows, equivalent to about one month, but urged authorities to consider extending the measure.
According to Duncan Amoah, restoring the GH¢2 regulatory margin could increase diesel prices from around GH¢17 to approximately GH¢19 per litre, bringing the price dangerously close to the GH¢20 mark.
COPEC has also projected marginal increases in fuel prices from Tuesday, September 1, citing developments in the international oil market.
Duncan Amoah indicated that petrol could be particularly affected, following an almost 10% increase in its international trading price over the previous two weeks.
He therefore warned that consumers could see higher petrol prices during the first pricing window of September as local fuel prices respond to developments on the global petroleum market.
The government introduced the GH¢2 per litre diesel regulatory margin reduction on August 4, following a significant increase in international crude oil prices that contributed to higher petroleum prices on the Ghanaian market.
The latest extension represents another government intervention aimed at cushioning consumers from the rising cost of fuel and transportation.
It is also expected to help reduce the immediate pressure that higher diesel prices could place on transportation, logistics and business operating costs.
Diesel price increases often have a wider impact on the economy because higher transport and logistics expenses can eventually affect the prices of goods and services.
The extension could therefore offer temporary relief to Ghanaian households and businesses as the government seeks to manage the impact of volatile international oil prices and rising living costs.
Source: newsthemegh.com