The price of liquefied petroleum gas (LPG) will rise by 5% starting today, March 3, 2022.
This is in response to the reinstatement of the Price Stabilization and Recovery Levy (PSRL) on fuel products.
The restored PSRL is 0.16 pesewas per litre of petrol, 0.14 pesewas per litre of diesel, and 0.14 pesewas per kilogram of LPG.
Experts have cautioned that the reinstatement of the PSRL and the resulting rise in the price of LPG would further reduce the commodity’s use rate and intensify the situation of the average customer.
LPG is currently $9.76 per kilogram, which equates to almost $140 for a 14.5 kg cylinder.
Gabriel Kumi, vice president of the LPG Marketers Association, blamed the incident on the cedi’s poor performance.
According to him, “once the cost keeps moving up and you have constant taxes and levies, you expect that the price will continue to go up.”
The price increased from $7.89 to $8.12 in December 2021 during the first pricing window. It increased to 8.22 in the second window of January 2022.
The price increased to 8.60 in the first window of February 2022, then to 9.29 in the second window.
Currently, the price is $9.76.
According to the LPG Marketers Association, the quick fluctuation in pricing is impacting their company owing to the lowering rate of LPG usage.
“Business is not doing too well because if you look at the statistics, the consumption of LPG is on a serious decline. So if measures are not taken, and the price continues to go up as it is going now, there will be a lot of negative consequences.”
“Today, some of our members have started laying off workers, and we are not growing. The consequences are quite dire,” Gabriel Kumi added.
The government has set a goal of raising commodities consumption from 25% to 50% by 2030 in order to make the product more accessible to a wider range of people.
Many, however, have contended that given the rate at which commodity prices are soaring, this goal may be unattainable.
Meanwhile, the National Petroleum Authority (NPA) has said that it is in talks with the Finance and Energy Ministries in order to find a workable solution to the ongoing increase in fuel prices.
According to the announcement, the meetings will mostly focus on the potential elimination of various tariffs on petroleum products.
Abass Ibrahim Tasunti, Head of Pricing at the National Petroleum Authority (NPA), said the NPA has offered certain recommendations to Cabinet for consideration.
“We have made some recommendations to the government as to what it can do, but it all depends on the government’s fiscal space. So for us, we look at what can be done to look at the laws available to us.
“Of all the taxes, which one could have been touched? From the law, the Price and Stabilisation and Recovery Levy is the one that could have been used to support the consumer. Our work is to make sure there is fair pricing,” he told JoyNews.
Meanwhile, the Energy Ministry has said that Ghanaians would repay any subsidies paid by the government.
According to the Deputy Minister, Andrews Agyapa Mercer, this necessitates a discussion among stakeholders as the government works to find a solution to the situation
“It’s a process that has commenced. The NPA has sent the letter to us, and we’ve forwarded it to the appropriate authorities; it’s going to be deliberated, and then whatever decision is taken is going to be in the best interest of all of us.”
“If that decision is taken that government has to subsidize fuel, we all ought to know that post the issues being resolved, prices coming down, whatever amount of money government would have expended would still have to be paid back by all of us,” he said.
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SOURCE: myjoyonline
