NPA announces new price floor for petroleum products

The National Petroleum Authority (NPA) has announced a new Price floor for the second pricing window, from 16th -31st October 2024. The authority has set GH₵12.73 for petrol and GH₵13.43 for diesel.

The development means that no oil marketing company should be selling below the price quotes.

The NPA in the notice to the Oil Marketing Companies (OMCs) and Liquefied Petroleum Gas (LPG) marketers advised all the players to comply with the above price floors for the window.

It added that the price floors exclude the premiums charged by International Oil Trading Companies (IOTCs) and the operating margins of BIDECs, as well as the Marketers’ and Dealers’ Margins of OMCs/LPGMCs.

These will be independently determined by the companies as pertains under the Price Deregulation Policy

The NPA introduced the price floor mechanism to check price undercutting in the industry. It stated that the practice if not checked could threaten the stability of the industry.

The NPA recently announced it has suspended the Price Floor programme for the Bulk Oil Distribution Companies.

This was based on some concerns expressed by the players in that sector. However, it is still going ahead with the programmme for the oil marketing companies .

The programme has faced some criticism from some players in the industry, who have described the policy as anti-free market programme.

The NPA insists the roll out of the price floor policy was based on industry consultation and recommendation by players on what steps must be taken to deal with price undercutting.