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New Gas Prices Go into Effect Across Ghana

New Gas Prices Go into Effect Across Ghana

Efam Dovi
Accra
Voice of America
May 3, 2006

In Ghana, higher gas prices came into effect Wednesday as crude oil prices continue to soar in the world market. There were long lines of vehicles in some stations, and many attendants had to use calculators to figure out the price.

Ghana gas station Ekow Dadzie

This is a local shell filling station in the capital Accra. Because of the price hike, business is more hectic than usual. Alhassan, a station attendant, is having difficulty serving his customers because the pump machines have not yet been programmed to reflect the new prices.

"One litter is 4,000… 8,492.5 cedis. 8,492.5 times 4.5 which is 5,8216 cedis. Thus one gallon," he said.

For the first time, the National Petroleum Authority, the government body in charge of regulating prices of petroleum products, did not set a uniform price for the gas stations. After increasing the tax on gas by 10 percent, it allowed the retailers to set their own prices.

With the increase, the average pump price for a gallon, or 3.8 liters, of premium gasoline is 38,200 cedis. That is equivalent to about $4.20.

But with the new system, prices may differ from station to station and that is upsetting Alhassan's customers.

"Some of the customers [were very upset about] the change of price, because now they haven't [a set price] so it is difficult, so we explain to them about the [price] in liters so they understand what we are giving them," he added.

But it is not only Alhassan's customers who are trying to understand the mechanism involved in fixing gas prices in the country. Pressure groups in the country have been criticizing President John Kufuor's government for increasing taxes on gasoline.

They say the current increase will cause hardship, and they want the government to reconsider the way petroleum products are taxed.

"It is quite painful but what do you do?" he asked. "We have already appealed to the government to consider some aspect of the taxes so the price also will go down, because when you look at it critically, it is the tax element that has actually escalated the prices," said Ekow Dadzie, the general secretary of the Communication Workers Union.

In past years when prices were increased, there were protests throughout the country. Protests are again expected this year.