Star Oil Suspends COMAC Membership Over Price Floor Disagreement
Star Oil Limited has suspended its membership of the Chamber of Oil Marketing Companies (COMAC) with immediate effect, citing deepening disagreements over the Chamber’s handling of the petroleum price floor debate and what it describes as unfair representation of its position.
The decision, announced in a statement issued on Wednesday, January 21, signals a major rift within Ghana’s downstream petroleum sector and raises concerns about unity within the industry’s leading advocacy body.
According to Star Oil, the suspension, described as indefinite, was taken after careful consideration. The company noted that it has been a long-standing and active member of COMAC and remains its largest financial contributor, supporting the Chamber’s operations and policy engagement over the years.
“Star Oil has always believed that COMAC exists to fairly represent the collective interests of its members, while accommodating divergent but well-intentioned views on policy matters,” the statement said. “Recent developments, however, have compelled us to reassess that belief.”
At the heart of the dispute is COMAC’s public stance on the petroleum price floor, a regulatory mechanism that has long divided industry players. Star Oil revealed that it has consistently called for the removal of the price floor, a position that differs from the majority view within the Chamber.
The company expressed concern that its perspective has not been adequately acknowledged or fairly communicated, particularly during recent media engagements by COMAC’s Chief Executive.
“The failure to clearly explain the rationale behind our position has created damaging public perceptions,” Star Oil stated, adding that it has been portrayed as acting with “anti-competitive or illicit motives,” which it described as “troubling, unfair, and harmful” to its reputation.
While recognising that most COMAC members favour retaining the price floor, Star Oil questioned why the Chamber appeared unwilling to reasonably articulate a dissenting view, even when it does not reflect the majority position.
Clarifying its stance, Star Oil said its opposition to the price floor is based on economic and market principles, arguing that the policy distorts pricing signals by preventing international product prices and foreign exchange movements from being reflected promptly in local prices.
“This distortion weakens competition and ultimately disadvantages consumers,” the company said, noting that similar arguments were previously used by Bulk Distribution Companies in their successful campaign to have their own price floor removed.
“In light of the above, Star Oil believes that its continued membership of COMAC under the current circumstances exposes the company to reputational risk without offering a fair platform for its views to be represented,” the statement concluded.
“We therefore consider it prudent to suspend our membership until such time as the Chamber demonstrates a clear commitment to balanced representation and fair communication of divergent member positions.”
