COMAC renews call for full deregulation of fuel prices

The Chamber of Oil Marketing Companies (COMAC) has once again urged for the complete deregulation of fuel prices, asserting that ongoing government influence is impacting private businesses in the downstream petroleum industry. This plea comes as the government continues to subsidize diesel, mitigating some of the repercussions of the surge in global oil prices.

Dr. Riverson Oppong, the CEO of COMAC, pointed out that the industry cannot be deemed fully deregulated when the government continues to affect certain elements of the fuel pricing structure. "This is an industry where we have pushed for a full price deregulation policy," he emphasized. Dr. Oppong questioned the rationale behind the government determining the prices private businesses set when companies operate in a free market and rely on loans to sustain their operations.

"If I'm a private business, I borrow money to run the business. Who is going to determine what I charge for my good, a ceiling, a cap and all those things because we are a free market economy," he queried. He further explained that while some components of the pricing formula have been deregulated, government interventions persist.

"There are aspects of the pricing price builder today that are not fully deregulated," he stated. "For sure, I can say that the margins of some components of the SREF are kind of deregulated, but we still have government interventions. That's why the government can say it's giving subsidies." Dr. Oppong highlighted government interference as one of the most significant challenges confronting oil marketing companies.

"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 added. He also raised concerns over the continuous entry of new players into an industry already saturated with oil marketing firms.

"If anybody today has applied for an oil marketing company's license, then the person, indeed, for two reasons, and I'll say it, I mean, unapologetically, that the person either does not understand the business, or is up to something, because what is it that you want to do that the 245 players cannot do?" he asked. Dr. Oppong maintained that a fully deregulated market would enable private sector operators to set prices without undue government interference.