Policy and Natural Resource Governance expert, Dr. Steve Manteaw, has warned that removing the National Petroleum Authority’s (NPA) minimum price floor for petrol could favor large oil marketing companies (OMCs) while undermining smaller competitors.
Speaking amid the public debate between GOIL and Star Oil over fuel pricing, Dr. Manteaw drew on international examples to highlight potential risks.“During the newspaper price war in the U.K., papers were sold far below cost, causing smaller competitors to become unprofitable and resulting in job losses,” he said.
He argued that deregulation without proper oversight could create a similar outcome in Ghana’s petroleum sector, where dominant OMCs might leverage their market power to push smaller players out.
“Before removing the minimum price floor, Ghana should establish an Anti-Monopoly Commission to monitor the sector and prevent monopolistic practices,” Dr. Manteaw advised.
While some industry players, like Star Oil, have called for scrapping the floor price to enable flexible, consumer-focused pricing models, Dr. Manteaw stressed that any potential short-term benefit to consumers could come at the expense of long-term competition and market fairness.
GOIL’s Managing Director, Edward Abambire Bawa, has previously questioned claims that fuel prices could be lowered further under the current pricing regime, noting that some OMCs advocating deeper cuts are still selling above the NPA-approved floor of GHS 9.80 per litre. Star Oil’s Philip Tieku, however, maintains that removing the floor would allow innovative pricing, such as discounted off-peak sales, to benefit consumers.
Dr. Manteaw’s intervention underscores the need for caution, advocating a balanced approach that safeguards small and medium OMCs while exploring market flexibility to benefit consumers.
