Gold for Oil: Selling oil to selected OMCs will kick others out of business – IES warns

Institute of Energy Security (IES) says the move to sell oil under Gold for Oil Policy to Oil Marketing Companies (OMCs) with 45 outlets and above will kick other OMCs out of business.

According to the IES, the government should have thought through the move adding that the announcement is retrogressive and wrong.

The National Petroleum Authority (NPA) has said it will sell oil to Oil Marketing Company (OMC) with more than 45 outlets under the Gold for Oil Program.

According to the NPA, the ultimate aim of the government in introducing the program is to ensure that fuel is affordable.

Speaking at the Meet the Press Series Wednesday, the Chief Executive Officer of the NPA, Mustapha Hamid said he had a number of calls asking him why the first consignment of the oil could not reflect in prices at the pumps.

But commenting on the announcement on Starr Today with Joshua Kodjo Mensah, the Executive Director for IES, Nana Amoasi VII indicated that in 2015 the country transitioned from a Regulated Down-Stream Petroleum to a Deregulated one in terms of pricing and supply.

He explained that the Deregulations of the sector means market forces will dictate what prices should be at the pumps in order to introduce efficiency and fair competition in the market.

“So it comes as a surprise for the government to be selective in this process and we believe that it will bring about unfair competition among the Oil Marketing Companies. If you choose to elect a few when you are talking about OMCs with at least 45 outlets across the country then you are talking about just about 36 percent of the players in the market.

“To select just a few and you give them a product that is supposedly affordable one. Then what you are trying to do is you are trying to kick others out of business. So the position taken by the government is wrong, is retrogressive and inefficient,” Nana Amoasi VII stated.