Commuters should brace themselves for another transport fare increment as the Ghana Private Road Transport Union (GPRTU) prepares to release new fares in the coming week.
According to the transport union, the high cost of operations had compelled them to take drastic decisions following the government’s failure to cushion Ghanaians.
They added that the rise in fuel prices also compounds their woes as transport operators, hence, the need to increase fares accordingly.
“We wish to announce to the general public that there will an increment in transport fares in the coming week. This is due to the current economic situation we find ourselves as a country. Prices of petroleum and spare parts keep increasing day in and out coupled with other nuisance taxes,” a statement issued on Tuesday, July 12 said.
The transport union is “urging the general public to cooperate with us when they witness an increment on fares as been discussed with relevant stakeholders.”
They also mentioned that they will resist any attempt by the government to bring back the operation of tollbooth.
“We also caution the government not to start the tollbooth operations again as has been hinted by our inside source. We will resist any attempt by the government to initiate the tollbooth operation,” the statement added.
The union used the opportunity to advise drivers to remain vigilant and adhere to all traffic regulations to avoid fatalities on our roads.
Fuel prices for a while now have been increasing consistently on the local market due to developments on the international market.
For the last pricing window, which was the second pricing window of June, prices of fuel on the local market increased by 4%. The price of Gasoil and Gasoline increased by 5% and 3% respectively.
The price slightly dropped from four weeks before after the government announced a 15 pesewas per litre reduction on the product for three months.
As of 13 July 2022, the average fuel price in Ghana stands at GHC11.31 pesewas.
What can be done to address the situation?
Despite the country producing oil in large quantities, the lack of refineries has prevented the country from enjoying lower prices of finished products.
As of September 2020, crude oil production capacity in Ghana was 196,000 barrels per day.
However, Ghanaians continue to buy fuel at exorbitant prices due to importation and taxes slapped on the commodity.
The Ranking Member on Parliament’s Energy Committee, John Abdulai Jinapor, has entreated the government to revamp the Tema Oil Refinery (TOR) to process Ghana’s crude to meet local demands instead of relying on the importation of refined oil.
Additionally, he suggested that the Bulk Oil Storage and Transportation Company Limited (BOST) should hold strategic reserves which could be used to ease supply challenges whenever necessary.
According to him, revenues from fuel levies should be enough to defray some of the cost to cushion consumers from bearing the brunt of high prices.
Mr Jinapor is not the only person to make such proposals to the government to address rising fuel prices.
COPEC-Ghana Executive Secretary, Duncan Amoah, had told The Ghana Report:
“We have a local refinery that we could have leveraged to get some fuel security at lower prices, but unfortunately, we don’t think there is a political will to refurbish the Tema Oil Refinery”.
Mr Amoah observed a fully functional refinery would cut the logistical cost, which adds to the price build-up by exporting crude to Europe to be refined before importing back to Ghana.
“They need to get TOR back on stream, and the need for political interference to be stopped holds the key for all for us,” he underscored.
Additionally, he cited the failure of BOST in executing its mandate.
Mr Amoah explained that BOST is supposed to store huge volumes of fuel and release it to the market to level prices and check shortages “without overstretching the already burdened Ghanaian taxpayer”.
However, “we do not see that function of BOST, and they are now focusing on trading…which was not the purpose of the BOST Act but to hold strategic stock”.
Furthermore, Mr Amoah wants the government to scrap taxes that add up to the fuel cost on the market.
This is because there are about 12 different taxes and levies on petroleum products, which adds up to almost 40% of the fuel price.
These taxes include the Energy Debt Recovery Levy, Road Fund Levy, Energy Fund Levy, Price Stabilisation and Recovery Levy, Sanitation and Pollution Levy, Energy Sector Recovery Levy, Special Petroleum Tax and Primary Distribution Margin, BOST Margin, Fuel Marking Margin, Marketers’ Margin and Dealers (Retailers/Operators) Margin.