Government as part of measures to mitigate the economic hardships on Ghanaians brought on by the COVID-19 pandemic and the geo-political tension between Russia and Ukraine has reduced margins in the petroleum price build-up by a total of 15 pesewas per litre.
Finance Minister, Ken Ofori-Atta who made the announcement during a government press conference in Accra on Thursday, March 24, 2022, said the reduction in margin is expected to reduce prices of petrol by 1.6 per cent and diesel by 1.4 per cent.
“The rising prices of fuel at the pumps is influenced largely by the rising crude oil prices on the international market and the exchange rate depreciation. Though the rise in crude oil prices should have been to our benefit on net basis, Ghana’s import of petroleum products amounts to five times the value of the proceeds from its crude oil exports. From January to date, the average ex-pump price of diesel and petrol have increased by 57% and 45% respectively.
“Unlike in other countries where the hike in crude oil prices and exchange rate volatility are leading to shortages in supply of petroleum products, government is implementing measures to guarantee constant supply of petroleum products. To mitigate the impact of the rising price of petroleum products at the pump, for the next three months, government has decided to reduce margins in the petroleum price build-up by a total of 15 pesewas per litre with effect from 1st April,” he said.
Providing a further breakdown, the Minister said government has reduced the Bulk Oil Storage Transportation (BOST) margin on fuel prices is reduced by 2 pesewas per litre, Unified Petroleum Pricing Fund (UPPF) margin is reduced by 9 pesewas per litre, Fuel Marking Margin (FMM) is reduced by 1 pesewa per litre and Primary Distribution Margin (PDM) reduced by 3 pesewas per litre.
This the Minister said with ongoing discussions between the National Petroleum Authority (NPA) and the Oil Marketing Companies (OMCs) to reduce their margins within the spirit of burden-sharing and coupled with measures taken to strengthen the Ghanaian cedi, prices of fuel at the various pumps will further stabilize.