According to Mr Ofori Atta, the reduction is aimed at mitigating “the impact of the rising price of petroleum products at the pump, for the next three months.”
The details are as follows:
- BOST margin reduced by 2 pesewas per litre
- Unified Petroleum Pricing Fund (UPPF) margin reduced by 9 pesewas per litre
- Fuel Marking Margin (FMM) reduced by 1 pesewa per litre
- Primary Distribution Margin (PDM) reduced by 3 pesewas per litre
Mr Ofori-Atta explained during his speech on Thursday that the rising fuel prices at the pump are largely influenced by rising crude oil prices on the international market and exchange rate depreciation hence the increase in petroleum products.
According to him, while the rise in crude oil prices in the international market should have benefited the country on a net basis, Ghana’s imports of petroleum products amounted to 5.2 times the value of its crude oil export proceeds.
“In 2022, we exported $3,947.70 million of which Ghana’s portion was $513 million. However, we imported $2,719.00 of crude oil and finished products. The purported windfall gain in foreign exchange is a mirage.
“From January to date, the average ex-pump price of diesel and petrol have increased by 57% and 45% respectively,” he explained.
He, however, stated that the reduction in margins of petroleum price build-up to be initiated in April is “expected to reduce prices of petrol by 1.6% and diesel by 1.4%.”
“We anticipate that the measures taken to strengthen the currency will help further stabilize the prices at the pump,” he added.
He further disclosed that discussions are underway with the National Petroleum Authority (NPA) to also reduce margins at the pumps “within the spirit of burden-sharing.”
“The Government will do all it can to ensure consistent supply of fuel and manage the rate of the ex-pump price increase by ensuring that BoG has access to adequate foreign exchange,” he said.
Also, the Finance Minister announced a 50% cut in fuel coupon allocation for state appointees effective February 1, 2022 as part of measures to mitigate the economic hardships in the country.