- COPEC urges NPA to scrap 2024 fuel price floors
- Policy described as outdated and anti-competition
- Duncan Amoah says price floors limit consumer savings
The Chamber of Petroleum Consumers (COPEC) has urged the National Petroleum Authority (NPA) to abolish the price floors outlined in the 2024 petroleum products pricing guidelines.
According to COPEC, the policy—which bars Petroleum Service Providers (PSPs) from selling fuel below a regulator-determined minimum—is obsolete and counterproductive in a deregulated downstream petroleum market.
Speaking to Citi Business News, COPEC’s Executive Secretary, Duncan Amoah, argued that the price floor offers no real benefit to consumers. He noted that removing it could enable oil marketing companies (OMCs) to further reduce fuel prices whenever market conditions allow.
His remarks come at a time when consumers are already experiencing some relief at the pumps following the commencement of the second pricing window in January.
“The price floor set by the NPA is outdated and must be scrapped. In a deregulated market, competition is key, and factors such as inventory levels or payment arrangements can influence how much different buyers pay for the same product,” Amoah said.
He explained that buyers who pay cash and settle promptly may be able to negotiate lower prices, while those purchasing on credit could pay slightly more. “It is therefore unclear why a regulatory body would interfere by imposing both price floors and ceilings. The market should be allowed to function freely to achieve efficient pricing,” he added.
Amoah further stressed that preventing OMCs from selling below the prescribed price floor ultimately disadvantages consumers. “If an OMC can sell at a lower price, insisting that it cannot only inconveniences consumers. The authority must begin to think differently and abandon this system of price controls, which does not serve consumers in any meaningful way,” he said.
Under the current pricing framework, the NPA sets and announces price floors for deregulated petroleum products at the start of each pricing window. PSPs are mandated to comply and are prohibited from selling below these levels, with violators facing fines of up to GHS5,000.
The introduction of price floors had previously drawn criticism from industry stakeholders, who argued that the policy suppresses competition and restricts potential cost savings for consumers.
