Liberia: Government Explains Sudden Hike in Price of Petroleum Products; Says It’s Motivated by External Factors

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MONROVIA – The Government of Liberia has emphasized that its recent decision to set a new price structure for petroleum products in the country was not arbitrary, but one motivated by external factors. 

Speaking during a special press briefing on Tuesday, Information Minister Ledgerhood J. Rennie said the government acknowledges that the increment is “hard to bite down”, but it is necessary to ensure the constant availability of the products on the market and the stability of the price. “We are hoping that in the next month or so, we can revisit the decision and there can be a decrease”, Minister Rennie said.

He explained that the government is aware that the cost of petroleum could have an adverse effect on the general price level, which is why it is planning to revisit the new price structure in the “soonest possible time”. He frowned on profiteering and hoarding of the products by some unscrupulous people, warning that anyone caught in the acts will be dealt with by the full weight of the law.

The Information Minister said the relevant Government agencies are working to announce fixed fares for transportation to various locations within 48 hours in order to avoid hiking of the cost. He warned commercial drivers against overcharging passengers.

For his part the Deputy Managing Director of the Liberian Petroleum Refining Company, Adrian Hoff, said importers of petroleum products in the country operate under a Collateral Management Agreement (CMA) that allows them to order products in the country without initially paying cash to the major international suppliers. But he said, once in the country, in order for products to be lifted from the LPRC storgae facility each day, and taken to the market, the Liberian importers will have to pay per consignment at the prevailing global rate – thus their clamor for an increment in price.

Mr. Hoff said the Weah Administration has made tough decisions in the past to avoid increasing the cost of petroleum products by cutting levies. “We have met with the President and his biggest concern has been ‘don’t increase the price’ “.

The pump price per gallon of gasoline is now $5.66, while diesel feul is $6.00. The government announced earlier that the decision stems from the Russian-Ukrainian crisis, since Russia is a major global exporter of crude oil.

Both men said the prices of gasoline and diesel fuel in Liberia is lower than many countries in the subregion. They urged Liberians to make some adjustments in order to conform to the current global reality, as the government continues discussions with importers so that the brunt of the problem isn’t felt by ordinary Liberians.

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