The Ministry of Commerce and Industry (MOC) and the Liberia Petroleum Refining Company (LPRC) on Monday announced a slight reduction in the wholesale and retail prices of petroleum products on the market.
The wholesale price of gasoline is now US$3.88; and fuel oil, US$3.93. The pump or retail price of gasoline is now US$4.06 or LD345, down from LD400; and fuel oil, US4.11 or LD350, down from LD380.
The announcement, signed by Commerce Minister Axel Addy and LPRC Managing Director T. Nelson Williams II, also indicated that due to the foreign exchange differential on the market, there will also be a five Liberian dollar reduction in the price of fuel oil.
The statement by the two industry executives made no mention of why they were offering the Liberian public this dispensation (special consideration). But we think it is obvious: EBOLA.
This is the second month in a row that we have seen a drop in the prices of petroleum. LPRC understands that because of the health crisis, there has been a significant downturn in country’s GDP, because there is no sector in the economy that has been unaffected by this health crisis.
Rubber production is down; and so are activities in other areas of the agricultural sector, the oil palm plantations among them. They are down for the same reason the mineral sector—iron ore, gold and diamond—is down. This is because many of the expatriate workers in these sectors have fled the country to avoid contracting the deadly Ebola virus. In the case of rubber, the Ebola outbreak came on the heels of another major problem in this sector—the significant decline in the price of rubber on the world market.
The major development projects being undertaken by government have also been drastically affected. Among these is the big one— rehabilitation work on the Mount Coffee Hydro. Most of the expatriate engineers and technicians working there have take the Ebola flight. Other development projects, including roads, are also at a standstill for the same reason.
The sudden departure of so many expatriate workers in international organizations, too, including diplomats and those working in international non-governmental organizations (NGOs), is another serious factor triggering the economic downturn. Hotels, restaurants, supermarkets, entertainment centers and other service industries have been badly hit by the expatriate flight.
The banks have also been hard hit—so hard that they tell us the crisis has forced them to go slow on lending, not only because of the health crisis but also the general uncertainty, since everyone is asking, to where is all this leading? And bankers, being the most conservative in the business sector, are forced into tread even more cautiously than normally.
Even Finance Minister Amara Konneh has admitted that because of this terrible health crisis, the worst in the country’s history, Liberia will not meet her targeted growth rate of 5.3 percent. The Finance Ministry and the International Monetary Fund have agreed that the projection for Liberian economy in the coming year will be down to 2.5 percent, from 5.3. But the World Bank thinks it may be even worse. The growth rate, according to WB estimates, will not be more than 1 percent, and in the coming year might be 0 percent!
The reduction in the cost of petroleum products suggests that there is somebody at LPRC who possesses something called compassion. He has compassion on his people, and therefore thought to reduce the cost of this most vital commodity that affects everyone. For who can do without petroleum? No one, for even if one does not have a motor vehicle, the taxi or motorbike one rides runs on petroleum, whose costs per passenger are always governed by the price of petroleum. When the petroleum price rises, the drivers raise their prices. So what LPRC has done directly affects everyone across the board.
We commend Commerce and LPRC for these reductions in the petroleum costs, and hope that the bus, taxi and bike owners will follow suit.