On 27th June, 2019, the Petroleum Regulatory Agency (PRA) engaged journalists during the usual Ministry of Information and Communications weekly press conference to brief pressmen on the pending increase in fuel prices.
One of the Oil Marketing Companies NP Sierra Leone Limited General Manager, Kobi Walker, disclosed that one of the major factors said to be responsible for this ugly state is the fact that there has been a huge difference between the actual price of PLATTS and the average purchase price of USD $ to the Leone when matched against that of the Petroleum Regulatory Agency Pricing Formula. And according to him this is a big challenge that NP and the Government cannot handle.
He said that it very challenging for OMC’s as other Africa countries like Liberia, Gambia etc are selling their petroleum products above 9000 Leones but he said for Sierra Leone the price still remains at Le7,000 for petrol and Le 7,500 for diesel stating it is a very difficult period for Sierra Leone.
He also said Foreign exchange owners are really challenged and for that reason foreign currencies are not freely available for them to continue the process and because of these factors oil companies are really going through trying times.
He further disclosed that according to research done by researchers it was disclosed that NP has record over ninety billion Leones losses which he said the researchers are not far away from the reality and that it is that magnitude of losses that the company is grappling with currently.
He also said it is not their sole responsibility as a company to subsidize.
NP GM noted that because they are subsidizing for others that is the reason responsible for encountering minuses taking cognisance of, PLATTS, foreign exchange rates all creating negative impact on their business.
He stated that Sierra Leone needs a volume of over 400 million litters every year.
He said that if the price for fuel remains like this it will lead to difficulties for survival but he said they are sure to address the issues with the relevant stakeholders.
He went further to say they as company cannot determine for increase in price of fuel as they have PRA which is the regulatory institution of OMCs to determine the increase of prices having looked at PLATTS, foreign exchange rates and other variables but said they as a company cannot continue in this manner but added that the relevant stakeholders are seriously looking into it and he is confident that there will be a solution pretty soon.
Kobi Walker said Government has engaged the Central Bank and Commercial Banks in order to provide foreign currencies for oil marketing companies in a bid to cushion the current situation bordering on the issue of increase in prices of petroleum products.
Speaking on behalf of Petroleum Regulatory Agency, Sallieu Kamara who is Head of Operations and Monitoring of the institution confirmed to Pressmen that there is no increase in the price of fuel but categorically stated that there are several issues surrounding the matter relating to the increase on the pump price.
He said as an Agency responsible to regulate the Oil Industry they have been engaging Oil Marketing Companies and other stakeholders in order to find an amicable solution to the situation.
Sallieu confirmed that oil companies are really running at loss because they are currently subsidizing but believes they might not want to continue like that which means actions need to be taken to tackle the current situation in the country.
He also disclosed that the reason for the current situation is as a result of Government not subsidizing fuel which means the only way we can maintain the current price is when government resumes paying subsidies.
The PRA Head of Operations and Monitoring went further to highlight the reasons that will lead to the increase in the pump price of fuel which he said is the landing cost which means if the landed cost shoots up to plus 5 percent there will be an increase in the pump price and if it decrease to minus 5 percent there will a reduction in the pump price.
“But presently pump prices remain the same if there is going to be any increase or decrease in the prices we will inform the public accordingly,” he ended.