The National Petroleum Authority (NPA) says Ghana’s fuel market is designed to encourage competition but prevent disorder that could undermine the industry and harm consumers.
Director of Economic Regulation and Planning at the NPA, Abass Ibrahim Tasunti, said the regulator’s policies are meant to balance deregulation with stability.
Speaking on Joy News’ PM Express on Wednesday, he stressed that competition among Oil Marketing Companies is allowed but must be controlled to protect the market structure.
“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.”
Mr Tasunti explained that the foundation of the current system dates back to reforms introduced in 2015 when Ghana moved from regulated fuel pricing to a deregulated market.
“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.”
He said the legal framework still requires companies to maintain consistent pricing within their own retail networks.
“And remember this instrument from Parliament that LI, or section 1C, still mandates oil marketing companies to keep a uniform price across their retail outlets.”
This means while companies are free to set their own prices, they cannot charge different prices at stations under the same brand.
“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 rule is linked to the Unified Petroleum Price Fund, a mechanism created to equalise the cost of transporting fuel 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 explained that the arrangement allows consumers in distant regions to pay the same price as those in major cities.
“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.”
According to him, the authority has repeatedly adjusted its guidelines to encourage fair competition while maintaining order in the market.
He noted that earlier rules required companies to keep the same price throughout a pricing window once it was announced.
“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 regulator later realised that such restrictions limited competition.
“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.”
As a result, the NPA introduced further reforms.
“And so we allowed oil marketing companies since 2024 to revise their price on a daily basis, within the cost of the window.”
Under the revised system, companies can adjust prices during the window but must notify the regulator in advance.
“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.”
He insisted the framework ensures that competition continues without destabilising the sector.
“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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