Dr Riverson Oppong, Chief Executive Officer of the Chamber of Oil Marketing Companies (COMAC), has called for full deregulation of Ghana’s fuel pricing regime, arguing that government intervention should be reduced in the downstream petroleum sector.
His comments come as the government continues to subsidise diesel amid rising international oil prices, with interventions in the pricing structure remaining a feature of Ghana’s downstream petroleum market.
According to Dr Oppong, oil marketing companies have consistently advocated for full price deregulation because they are private businesses that raise their own funds to operate.
“This is an industry where we have pushed for a full price deregulation policy,” he said.
He questioned why government should determine how private businesses price their products in what is intended to be a free-market economy.
“What is sometimes, I know, the regulation bit, the external hand that tries to come in, because if I’m a private business, I borrow money to run the business. Who is going to determine what I charge for my goods, a ceiling, a cap and all those things, because we are a free market economy,” he said.
Dr Oppong acknowledged that some components of Ghana’s petroleum pricing structure have been deregulated but said government interventions remain.
“There are aspects of the pricing price builder today that are not fully deregulated. For sure, I can say that the margins of some components of the SREF are kind of deregulated, but we still have government interventions,” he said.
He cited the government’s decision to subsidise fuel as an example of continued intervention in the sector.
“That’s why the government can say it’s giving subsidy,” he said.
The COMAC CEO described government intervention as one of the biggest challenges he has encountered since assuming his position.
“I’m also tempted to say that we do have too much government interference, and for me, ever since I took this position, it’s been one of the biggest challenges to deal with. That is government intervention,” he said.
COMAC CEO questions number of oil marketing companies
Dr Oppong also questioned the continued expansion of the oil marketing sector, arguing that the number of companies currently operating in the industry is already substantial.
He said prospective entrants should carefully consider the business environment before applying for an oil marketing company licence.
“If anybody today has applied for an oil marketing company’s license, then the person, indeed, for two reasons and I’ll say it, unapologetically, that the person either does not understand the business, or is up to something,” he said.
He added: “Because what is it that you want to do that the 245 players cannot do?”
