‘Fuel price increase no trick – Minister’

Deputy Energy Minister, Dr. Kwabena Donkor, has explained that the new fuel price increases announced by the National Petroleum Authority, NPA, have been engendered mainly by rising crude oil prices on the international market.

Another contributing factor, he told Kojo Oppong-Nkrumah on Joy FM’s Super Morning Show, is the weakening strength of the cedi relative to other trading currencies.

He has therefore dismissed claims by critics of the government who accuse it of playing tricks on the Ghanaian people to gain political power.

The NPA Wednesday confirmed new fuel price increases of between 2 and 10 per cent, safe for kerosene and premix fuel which remained unchanged.

Petrol went up 10%; LPG 5% and Diesel 2%. Petrol will now sell at GH¢3.86 per gallon while Diesel sells at GH¢3.90 per gallon.

“This was a trick? If you take a look at the NDC (National Democratic Congress) manifesto, there is a commitment in the manifesto to review taxes and levies within the first hundred days. That has been done. Remember price administration is driven essentially by world market conditions and fiscal policy, fiscal policy being taxes and levies. What the government controls directly is fiscal policy and here it committed itself in its manifesto as a party to reduce the levels of taxes and levies which it has done.

“Let me take you back to the then candidate Mills’ promise of reducing prices drastically, I think there is a certain misunderstanding here. As at the time that promise was being made and I personally reiterated that promise as the spokesperson on energy, there was a certain trend on the global market. The price of crude was coming down from the high of 144 dollars per barrel and going by the price formula at the time, we thought prices should have gone down by between 20 and 23 per cent and I made this clear.”

Dr. Donkor said the then government delayed in reducing the prices on grounds that it wanted to recoup some losses among other reasons.

He said when President Mills made the promise to reduce the prices, he did so based on pertaining conditions and following that pledge, “the then government rushed to reduce prices by 17 per cent…If we were in power at that time we would have reduced prices by between 20 and 23 per cent. They rushed to reduce prices by 17 percent which was good because that was what we were calling for. However on assuming office we further on through the instrumentality of fiscal policy, reduced prices further by an average of five per cent. In fact for some products it was 10 per cent…So that if you aggregate the reduction it comes to about minimum 22 per cent which was within our 20 to 23 per cent call.”



Story by Isaac Yeboah/Myjoyonline.com