The National Petroleum Authority (NPA) has rejected claims that it has banned fuel discounts insisting that the directive simply enforces a long-standing legal requirement for uniform pricing across the retail outlets of oil marketing companies.
Speaking on Joy News’ PM Express on Wednesday, the Director of Economic Regulation and Planning at the NPA, Abass Ibrahim Tasunti, said the law has always required companies to maintain the same price across their network of filling stations.
“In 2015, when we did regulated pricing, where we now allow the oil marketing companies to determine their price independently, when we started seeing competition in the industry, LI was amended, LI222, and this instrument from Parliament that LI, or section 1C, still mandates oil marketing companies to keep a uniform price across their retail outlets.”
He explained that while the sector operates under a deregulated pricing system, the rule requiring a single price across stations belonging to the same company has never changed.
“And so inasmuch as oil marketing companies determine their own prices, and we have prices varying between companies, the company must maintain a uniform price.”
Mr Tasunti said the requirement is linked to the Unified Petroleum Price Fund, which ensures equal fuel distribution costs across the country.
“And the reason is that we in the pricing formula, as you explained earlier, we have the Unified Petroleum Price Fund, which ensures that the cost of distributing petroleum products from the depots to the retailer is borne by this fund.”
He said the system allows consumers in different parts of the country to pay the same pump price, regardless of the cost of transporting fuel to those areas.
“So, oil marketing companies, on their own, do not pay for that cost. So at the end of every month, they submit claims to us to pay for the cost of transportation, and this is to ensure that the consumer in Wa, for example, pays the same price as the consumer in Accra, the consumer in Akokobi should pay the same price as a consumer in Tema.”
He added that because the distribution cost is absorbed by the fund, companies cannot charge different prices within the same network.
“And so an oil marketing company does not differentiate prices between the same network.”
Mr Tasunti said the NPA has continuously adjusted its pricing guidelines to promote competition while ensuring industry stability.
“Along the line, you know, we are trying to make sure that, as much as we deregulated, competition is promoted, but competition must be healthy. It shouldn’t be a competition that kills the industry.”
He noted that earlier rules required companies to maintain a fixed price throughout each pricing window, a practice the authority later reviewed.
“And even let me add this, that one of the guidelines earlier was also that oil marketing companies will set a price for the window, and within the window, they keep the price until the window ends.”
But the NPA later concluded that the rule limited competition within the market.
“This, we realise, does not really allow competition, because within the cost of the window, several factors can allow an oil marketing company to revise its price.”
To address that, the regulator allowed companies to adjust prices within the pricing window.
“And so we allowed oil marketing companies, since 2024, to revise their price on a daily basis, within the cost of the window.”
However, he said companies must notify the regulator before making such changes.
“So if an oil marketing company wants to reduce its price throughout the window, they can do so, but they have to inform the regulator that tomorrow, for example, I will review my price. You have informed us today.”
Mr Tasunti stressed that the regulatory changes were designed to strengthen competition rather than restrict it.
“And so nothing stops all marketing companies from being competitive. We’ve adjusted this pricing guideline over the period to allow them to be competitive.”
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