Star Oil withdraws from COMAC over disagreement on fuel price floor

Star Oil Limited has announced the immediate suspension of its membership in the Chamber of Oil Marketing Companies (COMAC), a move that has heightened divisions within Ghana’s downstream petroleum industry and raised questions about cohesion within the association.

In a statement released on Wednesday, January 21, the company said the suspension is indefinite and followed thorough deliberation.

The firm noted that it has been a dedicated and longstanding member of COMAC, as well as the Chamber’s biggest financial supporter, consistently contributing to its activities and advocacy efforts.

Star Oil explained that its decision to join COMAC was founded on the belief that the Chamber would fairly represent the interests of all members while allowing room for diverse but constructive opinions on policy and regulatory matters. However, the company said recent actions have eroded this expectation, leading it to reconsider its continued affiliation.

The disagreement centres on COMAC’s public position regarding the petroleum price floor, a highly debated regulatory policy in the sector.

According to Star Oil, it has persistently advocated for the removal of the price floor, a stance that differs from the dominant view within COMAC. The company expressed concern that its position has not been properly recognised or clearly communicated, especially during recent media appearances by the Chamber’s Chief Executive.

Star Oil argued that this lack of balanced messaging has contributed to negative public interpretations, wrongly portraying its position as anti-competitive or motivated by improper interests.

The company described such suggestions as unfair and harmful to its reputation, particularly given its longstanding contributions to the petroleum industry.

Reaffirming its stance, Star Oil stated that its opposition to the price floor is grounded in economic and market realities, contending that the policy interferes with pricing by delaying the reflection of global fuel prices and foreign exchange movements in the local market.

It added that this distortion reduces competition and ultimately harms consumers, noting that similar reasoning previously led to the removal of the price floor for Bulk Distribution Companies.

Star Oil concluded that remaining a member of COMAC under the current circumstances poses reputational risks without offering a fair platform for its views.

As a result, the company said it will keep its membership suspended until COMAC demonstrates a genuine commitment to balanced representation and equitable communication of differing viewpoints among its members.