The Institute for Energy Security (IES) is anticipating a twofold surge in fuel prices during April’s upcoming petroleum pricing window.
The surge is attributed to the reintroduction of the Price Stabilization and Recovery Levy on petroleum products by the National Petroleum Authority (NPA).
According to the Executive Director of IES, the levy had failed to stabilise fuel prices, citing historical instances where prices soared to GH¢18 per litre in 2022.
Nana Amoasi VII warned of an impending fuel price surge, indicating that prices could rise to approximately GH¢14.05 per litre, potentially resulting in a double increase.
“The suspension of the levy was not well-thought through because it was clear in the statement that it was intended to relieve consumers of intending price hikes which are necessitated by happenings on the world market and also our own forex market. Then the OMCs increase fuel prices in response to the domestic foreign market and the international fuel market.
“Unfortunately, a day or two, the NPA comes to say we are reversing the suspension of that levy which is meant to cushion consumers and this time around, the NPA fails to give the reasons for the suspension.
“We have not seen any impact of this levy on fuel prices over the years because it has not been able to stabilise prices and prices shot up as high as GH¢18 per litre somewhere in 2022 and we are seeing the same thing now.”
“What is going to happen is that fuel is going to increase again. Few have done it already and others are yet to do it and prices will roughly rise GH¢14.05 and so fuel prices will soon see a double increase,” he added.
Background
The National Petroleum Authority announced, in a letter dated March 28, 2024, the suspension of the Price Stabilization and Recovery Levy (PSRL) on price build-up on petroleum products.
This froze the implementation of the levy charged on every litre of petroleum products and Kilogram of LPG from Monday, April 1 to June 30, 2024.
According to the National Petroleum Authority, this was based on a directive from the Finance Ministry and the Energy Ministry.
About Price Stabilization and Recovery Levy
The Energy Sector Levies Act 2015 (Act 899) allows the National Petroleum Authority to stabilise petroleum product prices for consumers over a certain period.
It currently charges 16 pesewas per litre for petrol, fourteen pesewas per litre (GHp14/Lt) for diesel and 14 pesewas per kilogram (GHp14/Kg) for LPG.