The Chamber of Oil Marketing Companies (COMAC) is calling on the government to temporarily suspend the GH¢1 levy on petroleum products to ease the burden on consumers as fuel prices continue to rise.
The appeal comes as oil marketing companies (OMCs) implement successive fuel price increases, with diesel prices nearing GH¢20 per litre due to higher global refined petroleum prices and increasing import costs.
Chief Executive Officer of COMAC, Dr. Riverson Oppong, said the levy, introduced when fuel prices had dropped significantly, should now be removed to provide relief for households and businesses facing rising transport and energy costs.
“We have said it many times, but it never happened. This is probably the time for the energy sector levy to be removed so consumers can benefit,” he said.
Dr. Oppong argued that the reason for introducing the additional levy no longer reflects current market conditions.
“The same reason you brought it because fuel prices had moved from GH¢17 to GH¢10, then you added one cedi. Now we are almost back there again. So take it off and get the praise that you deserve,” he stated.
He noted that taxes and levies now make up a significant share of fuel prices and said suspending the GH¢1 levy would help reduce the impact of rising international oil prices without seriously affecting government revenue.
COMAC also warned that fuel prices are likely to increase further in the next pricing window as higher global petroleum prices and exchange rate pressures continue to push up import costs.
“It’s too early to give any figure in terms of percentage increase, but for sure we are going to see an increase. Even as it stands, we have seen almost a 10% increase across products,” Dr. Oppong noted.
He explained that both major factors influencing fuel prices on international petroleum prices and the cedi-dollar exchange rate are moving in an unfavourable direction.
“The two most important factors increasing fuel prices are all activated and that would be a very big blow to the ordinary Ghanaian,” he warned.
Dr. Oppong also said oil marketing companies can no longer absorb rising costs, as wholesale fuel prices are now changing several times a day.
“I have seen BDCs changing their prices every hour and we cannot continue selling below replacement cost just in the name of price wars. The price war is over. Now let’s face the facts,” he said.
He urged the government to make more foreign exchange available for fuel imports to reduce pressure on the cedi.
“I would advise that the government make dollars available for the importation of crude oil and petroleum products so that we don’t feel the heat from the growing demand for foreign exchange,” Dr. Oppong said.
