The suspension of the Price and Stabilization Recovery Levy (PSRL) on petroleum products has been extended for an additional month after an approval by President Nana Addo Dankwa Akufo-Addo on Tuesday January 4.
The suspension of the Price and Stabilization Recovery Levy [PSRL] would have ended on December 31, 2021 but for the extension.
Mr Akufo-Addo in October last year granted approval to zero the Price Stabilization and Recovery Levies on petrol, diesel and LPG for two months.
A statement issued by the National Petroleum Authority (NPA) said the approval followed the advice of the NPA to the Minister of Energy to seek government’s intervention to mitigate the impact of rising prices of petroleum products on the world market on consumers.
Prices of crude oil and refined petroleum products, according to the NPA, had seen sharp increases on the world market due to a rise in demand of oil globally without a corresponding increase in supply, particularly from the Organisation of Petroleum Exporting Countries (OPEC) and its allies.
Because pricing of petroleum products in Ghana is deregulated, changes in prices of petroleum products on the world market have a direct impact on prices at the pumps, the NPA further stated.
” The outlook of prices on the global market shows an upward trend and therefore there was the need to seek government’s intervention to lower the levies to cushion consumers from feeling the full impact of these rising prices.
“The purpose of the Price Stabilisation and Recovery Levy (PSRL) is to stabilise prices for consumers and pay for the subsidies on Premix Fuel and Residual Fuel Oil (RFO). At this time it is important that the PSRL which is currently sixteen pesewas per liter (GHp16/Lt) on petrol, fourteen pesewas per litre (GHp14/Lt) on diesel, and fourteen pesewas per kilogram (GHp14/Kg) on LPG are zeroed to cushion consumers.
“The NPA will work with the Ministries of Energy and Finance to quicken the legislative processes to give immediate effect to this directive by the President.
“We are grateful to H.E. the President for granting the request to zero these levies to minimise the effect of rising prices of petroleum products on the world market on consumers in Ghana.”
The Chamber of Petroleum Consumers (COPEC) had on Monday Janury 3, 2022 predicted that prices of petrol and diesel were expected to surge by 3.7% and 2.5% respectively.
In nominal terms, COPEC said, ex-pump prices of petrol and diesel are expected to increase by 24 pesewas and 17 pesewas respectively.
“The average surge for both products in nominal terms is 20 pesewas representing 3.1%. Some Oil Marketing Companies (OMCs) could increase their prices less than the 20 pesewas increase due to competition,” a statement issued by COPEC indicated on Monday January 3.
It added “Brent crude plunged by 10.7% to $73.45/barrel on the 26th November, 2021 and the OPEC Reference Basket (OPB) plunged by 6.9% to $76.09/barrel on the same date. The OPB further tumbled to $70.07/barrel on 2nd December, 2021. The plummeting crude oil prices was due to the new Omicron Variant new COVID-19 Omicron (B.1.1.529) variant which restricted mobility in some countries, and the expectation of gradual increment of oil production by Organisation of Petroleum Exporting Countries (OPEC).
“However, Brent crude futures settled up $1.56, or 2.1%, at $76.85 a barrel, the highest close since Nov. 26, and a gain of 4.5% on the week as at 23rd December, 2021. Additionally the U.S. West Texas Intermediate (WTI) crude futures ended up $1.03, or 1.4%, at $73.79 a barrel, to rise 4.1% on the week as at 23rd December, 2021. The surge in crude oil prices is due to Libyan
supply disruptions cutting supply of about 300,000 b/d and the lower anxiety towards the new Omicron variant because of the perception that, the variant is containable than previously feared.
“In Ghana, the National Petroleum Authority (NPA) indicated that the benchmark price for petrol/MT for setting ex-pump price of petrol in the 1st Window of January, 2022 is $707.95/MT.
“Again, the Benchmark price for diesel/MT for setting ex-pump price in the same widow is $641.38/MT. The NPA set the Ghana Cedi at Ghc6.4040 against a dollar.”
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