The National Petroleum Authority (NPA) has introduced a price floor mechanism for the second half of October 2024, establishing a minimum cost of GH₵12.73 per litre for petrol and GH₵13.43 per litre for diesel. This regulatory directive prohibits any oil marketing company from selling fuel below these specific benchmarks.
In its guidance to Oil Marketing Companies (OMCs) and Liquefied Petroleum Gas (LPG) marketers, the authority emphasized that all industry participants must adhere strictly to these minimum rates for the current pricing window.
Under the existing Price Deregulation Policy, certain costs remain outside the scope of the NPA’s mandatory floor. These include the premiums applied by International Oil Trading Companies, the operating margins of Bulk Import, Distribution, and Export Companies (BIDECs), and the specific margins set by marketers and dealers. Individual companies retain the independence to determine these figures based on their unique operational structures and market strategies.
The primary objective of the price floor is to eliminate the practice of price undercutting, which the NPA warns could destabilize the entire petroleum sector if left unaddressed. While the program was recently paused for BIDECs following specific industry feedback, it remains fully operational for retail OMCs.
The policy has faced some pushback from industry critics who argue it interferes with free-market competition, but the NPA maintains that the system was developed through extensive consultation with stakeholders to ensure long-term stability and fair practices within the downstream industry.
