Fuel price relief measures may not be sustainable in the long term – COPEC
The Chamber of Petroleum Consumers (COPEC) has cautioned that while government intervention to reduce fuel prices may provide short-term relief, such measures are unlikely to be fiscally sustainable if relied upon repeatedly.
The Chamber of Petroleum Consumers (COPEC) has warned that government interventions to lower fuel prices, like a recent GH¢2.00-per-litre reduction, may not be fiscally sustainable in the long run. President John Dramani Mahama approved this temporary measure to aid consumers, businesses, and public transport on August 4. COPEC acknowledged the need for such action, as uncontrolled fuel price hikes could lead to higher transport costs, increased goods and service prices, inflation, and impact fiscal targets.
COPEC Executive Secretary Duncan Amoah explained that the government intervenes to ease consumer burdens and protect economic objectives. He stated that if fuel prices soar to GH¢20 for diesel and around GH¢17-18 for petrol, transport fares would rise, affecting goods and service costs and inflation. Government contractors might renegotiate contracts if fuel prices reach a crisis level, adding pressure to public finances.
However, COPEC cautioned that such interventions could become challenging to sustain, especially given Ghana's fiscal constraints and economic reform commitments. Amoah suggested the government establish a strategic fuel reserve system to better handle future global oil price shocks, arguing a long-term strategy would reduce the need for emergency subsidies and protect consumers from sharp fuel price increases.
Written by urgent.news from MyJoyOnline Ghana's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
