The Head of Economic Regulation at the National Petroleum Authority (NPA), Abass Ibrahim Tasunti, says the government can only subsidise petroleum products if it can do so, despite the hikes in petrol prices in the country.
“Subsidy in itself is not really a good thing; but because you the consumer you’re only interested in the cheaper prices but you forget that if the price is cheaper and the product is not available, you will not like that,” he said.
“For us, if the government wants to subsidise, the NPA as a regulator cannot say it would not allow the subsidy to pass but it is for the government to analyse or assess its capacity to subsidize but you must have the money before you can subsidise so that we don’t go back to the issue where you have to subsidise but there’s no money and there’s a shortage,” he added.
He further explained the NPA can only advise the government when it realises prices are rising to use the Price Stabilization and Recovery Levy to cushion consumers which the authority did last year.
Giving a presentation on the Price Formula in Ghana during a day’s capacity-building training for journalists in the Northern Region, Mr Tasunti explained that Nigeria as an OPEC country, when they restructured their petroleum industry last year, decided to scrap subsidies on petrol by June this year.
This is because about 70 percent of vehicles in Nigeria run on petrol but in Ghana, it is the other way round, more diesel is consumed.
“But because Nigeria produces a lot more crude oil than Ghana does, they’re able to use the revenue they generate from the crude oil export to subsidise the petrol prices for consumers, and even they say they want to scrap the subsidy because they aren’t able to afford the subsidy,” he explained.
Additionally, he said, the Bank of Ghana (BoG) is organising special exchange rate options for the oil industry, asserting it used not to happen until three months ago so that the rate at which the oil industry gets the dollar becomes predictable to help stabilise the price for the public.
For his part, the NPA Head of Quality Assurance, Saeed Ubeidalah Kutia, gave an assurance that the authority will continue to put in quality control measures along the value chain to guarantee the integrity of petroleum products in the country.
The National Petroleum Authority has also urged consumers to report issues of fuel adulteration within 48hours for swift investigations and redress.