Petrol and diesel prices set to rise on June 16 over cedi depreciation
Prices of petrol and diesel are expected to witness an upward trajectory, effective from Friday, June 16, 2023. However, there is a glimmer of relief for Liquefied Petroleum Gas (LPG) consumers as the price for this commodity is projected to remain unchanged during this period.
This impending price increase according to the Chamber for Petroleum Consumers (COPEC), marks the first consecutive rise in petrol and diesel prices since the beginning of June 2023, triggering concerns among consumers and industry observers alike. The Chamber for Petroleum Consumers (COPEC) shed light on the factors driving this surge, emphasizing the recent 4.16% depreciation of the local currency, the cedi, against the dollar over the past two weeks.
While global crude prices have experienced a slight decline, with the mean price per barrel dropping from $76.04 to $75.46 (-0.76%), the adverse movement in the forex market has offset this relief. The average exchange rate rose from 11.3394 to 11.8111 cedis per US dollar, representing a 4.16% increase. This currency depreciation has played a significant role in the expected price hike, adding to the financial burden faced by consumers.
COPEC’s analysis indicates that the average selling price of petrol is set to reach ¢12.21 per litre, while diesel will be priced at ¢12.27 per litre. Meanwhile, LPG is anticipated to maintain its current pricing of ¢10.40 per kilogramme. Consequently, a standard 14.5-kilogramme LPG cylinder will be priced at ¢150.85, offering some stability to consumers who rely on this fuel source.
The advocacy group, COPEC, is calling on the government to take proactive measures to alleviate the impact of rising fuel prices on the public. Their primary recommendation is a reduction in taxes on LPG or even the introduction of subsidies to foster widespread accessibility and usage of this environmentally-friendly energy alternative. Presently, the total taxes and levies imposed on petrol and diesel account for approximately 25% of their respective retail prices, exacerbating the financial burden faced by consumers.
COPEC’s proposal to reduce or remove certain fuel taxes is driven by the aim to lighten the load on consumers and promote a more sustainable and cost-effective energy landscape. By encouraging the government to embrace tax reforms in the fuel sector, COPEC envisions a scenario where consumers can navigate the rising prices with greater ease, thereby facilitating economic stability and individual financial well-being.
As the anticipated price hikes loom large, consumers find themselves at the mercy of fluctuating currency exchange rates and global market dynamics. The outcome of these developments will undoubtedly have wide-ranging implications for household budgets, transportation costs, and overall economic stability. The government’s response to COPEC’s call for tax reduction on LPG will be crucial in shaping the path forward for energy consumers and determining the long-term viability of cleaner energy alternatives.
