Gov’t to stop fuel subsidies

• Posted on August 20, 2014August 20, 2014
• by Nana Kwesi Coomson
• Comment

Deputy Minister of Energy, Benjamin Dagadu, has disclosed that government would from next month cease its subsidy programme to ensure that consumers pay the full cost of the commodity as it pertains on the world market.

He made this known recently to the media in Accra.

Currently, there is a shortage of diesel and premix fuel on the local market mainly due to government’s failure to pay some GH¢1.8 billion owed in debts to importers of petroleum products.

Most fuel stations cannot access ordered quantities of diesel and premix fuel to meet market demands while petrol has also been in short supply because the bulk distribution companies (BDCs) are not supplying.

Fanned by hikes in utility prices, the operators of fuel stations have noted that they have been challenged to break even.

Meanwhile, the Energy Ministry has announced that it has released 34 million litres of diesel for onward distribution to filling stations across the country in an attempt to minimize the current fuel shortage.

Speaking in an interview with an Accra-based radio station, Citi fm, Mr Dagadu emphasised: “As I am speaking to you, there is 34 million litres of diesel being pumped into the system from Tema , which will enough for one week,” he revealed.

There are reports of diesel shortage in parts of the Ashanti, Western, Volta and Northern regions of Ghana for since last week.

About a couple of months ago, Ghana was hit with a severe shortage of petroleum products due to government’s indebtedness to the BDCs.

CEO of the Chamber of Bulk Oil Distributors, Senyo Horsi, commenting on the fuel subsidy termination, indicated that scrapping the fuel subsidies would go a long way to improve fuel supply in the country.

The Petroleum Retailers Association also claimed that members were considering the dismissal of workers in order to survive the impact of inconsistent and inadequate supply of petroleum products.

By Samuel Boadi