Government extends GH¢2 diesel subsidy for two more months

The government has extended the GH¢2-per-litre subsidy on diesel for two additional months, aiming to alleviate consumers from soaring fuel prices. This measure will now extend to September and November 2026. The financing of the subsidy has shifted from the previous system, where the entire GH¢2 reduction was deducted from diesel margins.

Instead, the new approach entails a GH¢1 reduction in the D-Levy on diesel and a GH¢1 decrease in the margins. Consequently, diesel will still receive a combined subsidy of GH¢2 per litre, but now the expense will be shared between the government and industry via the reductions in the D-Levy and margins. This intervention continues the government-industry burden-sharing model established on April 16, 2026.

The extension is designed to provide some respite to motorists, commercial transport operators, and businesses that heavily depend on diesel, especially considering the increasing international crude oil prices. The government initiated the latest fuel price intervention on August 4, responding to a surge in global oil prices. This marks the fourth intervention by the government to alleviate consumers' burden against rising fuel costs.

However, JoyBusiness reports concerns over unpaid subsidies to oil marketing companies following the August extension. The current arrangement is anticipated to maintain pump relief while dispersing the intervention's cost between government revenue from the D-Levy and industry margins.