Accra, Ghana – The Institute for Energy Security (IES) has mounted a strong defence of the National Petroleum Authority’s (NPA) price floor policy, describing it as a critical safeguard for fair competition and long-term stability in Ghana’s deregulated petroleum downstream market.
In a press release issued on 19 January 2026, IES responded to recent public statements by the Chief Executive Officer of StarOil Ghana, who claimed the company could sell petrol at as low as GHS 9.50 per litre during off-peak night hours if not for the NPA’s price floor regime.
The claims have generated widespread public debate and reactions on social media. While acknowledging that public engagement on fuel pricing is healthy, IES cautioned that such discussions must be grounded in sound market principles and regulatory realities.
According to the institute, the petroleum downstream sector is capital-intensive, high-risk, and highly exposed to global oil price volatility and foreign exchange fluctuations. It stressed that the price floor is not a price-fixing mechanism but a competition-stabilising tool designed to prevent market distortions.
IES explained that the policy plays several critical roles, including preventing predatory pricing by dominant firms, protecting small and emerging Oil Marketing Companies (OMCs), ensuring supply continuity, and preserving healthy competition in the sector. The institute warned that unchecked price wars could drive smaller players out of business, eventually leading to monopolisation and higher fuel prices for consumers.
Drawing on international experience, IES noted that fuel markets without adequate regulatory safeguards often suffer supply disruptions and long-term price hikes, despite short-term consumer relief.
The institute also raised concerns over StarOil’s suggestion that fuel prices could be selectively reduced during specific hours, arguing that fuel retailing does not operate like a digital service where costs disappear at night. Storage, financing, distribution, and inventory risks, it said, remain constant regardless of the time of day.
“If an OMC claims it can sustainably sell below the regulatory floor, legitimate questions arise,” the statement noted, including whether such pricing is below economic cost, whether losses are being cross-subsidised to eliminate competitors, and what would happen to prices once competitors exit the market.
IES further pointed out that several industry players, including GOIL Ghana, have publicly challenged StarOil’s claims. The Group CEO of GOIL has reportedly stated that some companies advocating for lower prices are unable to compete even at the approved floor price of GHS 9.80 per litre under the current pricing window.
The institute questioned whether calls for the removal of the price floor would have emerged if StarOil were not currently a market leader, warning against what it described as regulatory opportunism disguised as consumer advocacy.
Historically, IES said, regulatory protections such as the price floor enabled many OMCs to survive intense competition, grow their operations, and invest in infrastructure. It argued that dismantling these protections after achieving market dominance raises serious competition concerns.
As a result, IES has formally called on the NPA to investigate StarOil’s pricing claims and cost structures, examine possible attempts at predatory pricing, assess compliance with existing regulations, and reaffirm the principles behind the price floor regime.
The institute emphasised that regulation in critical sectors such as petroleum must be evidence-based, transparent, and uniformly enforced, given its direct impact on household welfare and national economic stability.
IES concluded that the debate on fuel pricing should move beyond headline-grabbing claims to a deeper engagement with market economics, competition policy, and long-term consumer protection, reiterating its commitment to policies that promote fair competition, energy security, and sustainable consumer welfare in Ghana.