The prices of all the major petroleum products were reviewed downwards yesterday by the pricing authority, the National Petroleum Authority (NPA) in line with the tax reduction proposed by government in the 2009 budget presented to parliament last Thursday.
A gallon of petrol now sells at GH¢3.51 from GH¢3.69, representing a drop of 5%, and diesel at GH¢3.89 from GH¢4.00 representing a 2.8% decrease. The reduction is a drop in the litre price of petrol from GHp82 to GHp78, and diesel from about GHp89 toGHp85.
The price of kerosene has also dropped from 70 GHp to 67GHp. Premix fuel, the fuel used by fishermen is also selling at 40GHp per litre Liquefied Petroleum Gas (LPG) also went down to GH¢59 per kg.
Meanwhile Officials of the Ghana Road Transport Union have given an early indication that considering the final reduction in the prices, it was most unlikely that transport fares would be reduced.
Sidik Alandu, General Secretary of the Union, speaking on Citi FM, an Accra based radio station said "I don't think that the percent is anything that people should be thinking much about ... sometimes we also consider the worker's salary and all these things. That is why if you look at it, lorry fares in Ghana are not charged commercially. If we actually want to charge commercial fares, they will definitely be very high".
He bemoaned the reluctance of the stakeholders involved in the fuel pricing process to hold discussions with them on the fuel price to be charged. "What we have always been calling for is that before they come out they should let us sit down to go into the discussions before they come out. Sometimes, if we find it necessary to reduce them spontaneously we come out together".
He noted that it was unfortunate that factors such as the cost of the vehicle, insurance and the nation's bank interest rates were often not considered by the public when demanding a reduction in transport fares. The reduction is the first after the controversial drop in fuel prices by the last administration on the eve of the runoff elections in December 2008, following drops in international market prices of crude oil.
President Mills at his first State of the Nation Address to Parliament in February said the proposed tax cuts are in line with the ruling party's manifesto pledge to reduce the cost of fuel to ease the financial burden on Ghanaians. Meanwhile, Finance Minister Kwabena Duffuor has, however, warned that the cuts will result in a loss of close to $5Omillion to the economy.