When the NPP was in government, the NDC frequently described rising domestic fuel prices as evidence of economic mismanagement and criticised the government for what it characterised as insensitive leadership.

The renewed debate over rising fuel prices in Ghana has once again brought the politics of petroleum pricing to the centre of national discussion, with the opposition New Patriotic Party (NPP) criticising the government over the cost of fuel and the governing National Democratic Congress (NDC) pointing to international market conditions, exchange-rate movements and other economic factors.

The debate, however, has a political history.

When the NPP was in government, the NDC frequently described rising domestic fuel prices as evidence of economic mismanagement and criticised the government for what it characterised as insensitive leadership.

In October 2021, for instance, the NDC attributed persistent increases in fuel prices under the Akufo-Addo/Bawumia administration to what it described as “insensitive and bad leadership.”

The party pointed to taxes and the depreciation of the cedi and called for stronger economic management to stabilise the currency and, consequently, fuel prices.

But the international context was also significant.

The year 2021 coincided with a major global energy shock. As economies reopened following the COVID-19 pandemic, global demand for petroleum recovered rapidly while supply remained constrained.

Production restraints by OPEC+, reduced investment in oil production and declining global petroleum inventories contributed to a sharp increase in international crude-oil prices.

Brent crude began 2021 at around US$50 per barrel and had risen to approximately US$86 by late October, representing an increase of more than 70 percent.

The U.S. Energy Information Administration estimated that global petroleum inventories declined by about 469 million barrels during 2021, one of the largest annual withdrawals recorded in the period under review.

The International Monetary Fund similarly reported in October 2021 that Brent crude had risen above US$85 per barrel, its highest level in seven years at the time, amid tight energy supplies and a broader surge in global energy prices.

Ghana did not create those external pressures.

Nevertheless, the political debate at the time was often reduced to a relatively simple proposition: fuel prices were rising, therefore the government was failing.

Today, the political circumstances have changed. The NDC is in government, while the NPP is in opposition. As fuel prices rise again, the discussion has increasingly focused on international petroleum prices, geopolitical developments, exchange-rate movements and the transmission of global market conditions to the domestic pump.

Those factors are economically relevant.

But they were also relevant in 2021.

The Economics of Fuel Pricing

The basic mechanics of fuel pricing have not changed with a change in government.

In broad terms, domestic pump prices are influenced by international petroleum product prices, the exchange rate, taxes and levies, and other applicable margins and costs.

Ghana is largely a price-taker in the international petroleum market. Consequently, increases in international petroleum prices can raise the cost of imported refined petroleum products.

A depreciation of the cedi against major trading currencies can add further pressure, while a stronger cedi can provide some relief.

That transmission mechanism did not emerge in January 2025.

It existed during the Akufo-Addo administration and continues to exist under President John Dramani Mahama.

This makes the central issue in the current debate not merely whether fuel prices are higher or lower than they were at a particular point in the past, but whether political actors are applying a consistent standard when explaining fuel-price movements.

If international crude-oil prices and geopolitical developments are legitimate considerations today, they were also relevant in 2021.

If exchange-rate management is considered part of government's responsibility today, it was equally relevant under the previous administration.

And if fuel prices are used as an indicator of economic management, the same measure should be examined consistently across administrations.

NPP Points to Previous Fuel-Price Interventions

The NPP has, in the current debate, pointed to several measures implemented during its period in government as evidence that it provided relief to consumers when fuel prices came under pressure.

Among the measures cited are the abolition of the excise tax on fuel, reductions in the Special Petroleum Tax, changes to the tax from an ad valorem system to a specific tax regime, and periods during which the Petroleum Products Stabilisation and Recovery Account levy was zero-rated.

The party has also highlighted the Gold for Oil programme, introduced as part of efforts to use gold reserves to facilitate the importation of petroleum products and reduce pressure on foreign-exchange resources.

NPP supporters have described the programme as a major intervention that contributed to a reduction in pump prices from levels above GH¢20 per litre to around GH¢11 at certain points.

The NPP argues that several of these interventions were supported by legislation and had fiscal implications that were absorbed through the national budget.

Debate Over the Current Diesel Relief

The NPP has also criticised the government's current intervention on diesel prices, describing the GH¢2-per-litre relief as temporary and arguing that it relies on reductions in margins available to entities within the petroleum sector, including the Bulk Oil Storage and Transportation Company (BOST) and the Unified Petroleum Pricing Fund (UPPF).

According to the opposition's argument, this approach could weaken the financial resilience of institutions within the petroleum sector if sustained over an extended period.

The NPP further argues that the relief has been partly offset by other petroleum-related charges, including a GH¢1-per-litre levy, as well as increases in levies affecting fuel oil used by industries and power producers.

The party has also pointed to movements in the cedi as another factor limiting the impact of the relief.

These claims form part of the broader opposition argument that temporary reductions in fuel margins cannot provide a lasting solution to elevated pump prices.

Calls for a Broader Intervention

With diesel prices still being reported in the range of approximately GH¢17.55 to GH¢18.99 per litre in some outlets, the NPP is calling for a more comprehensive government intervention.

Among the measures it has proposed is a review of taxes and levies on petroleum products, including reconsideration of recent increases, arguing that the government could provide greater relief to consumers by suspending or reversing some of the additional charges.

The wider debate, however, goes beyond which political party has the more persuasive explanation.

Fuel prices are influenced by a combination of global crude-oil and refined-product prices, exchange rates, taxes, levies, margins and domestic policy decisions.

Governments have some ability to cushion consumers from external shocks, but the extent of that intervention carries implications for tax revenues, public finances and the sustainability of the petroleum-sector institutions.

The political lesson from the fuel-price debate is therefore also a lesson in consistency.

Economic forces do not change when governments change.

The international oil market does not distinguish between the NPP and the NDC. Neither does the exchange rate.

What changes is who is responsible for explaining the consequences to the public.

Report By: Robicon Mornahson