MONROVIA – The Liberian Senate has called for a comprehensive review of the country’s petroleum pricing formula, citing an “alarming and unfair” structure that places unnecessary burdens on consumers. The review follows a letter from Senator Emmanuel J. Nuquay of Margibi County, who highlighted the need to restructure petroleum pricing to benefit the Liberian people.
In his June 30, 2025, letter to Senate President Pro-Tempore Nyonblee Karnga-Lawrence, Senator Nuquay raised concerns over a complex pricing structure with approximately sixteen separate components that cumulatively determine the final price of petroleum products. Some charges are set by legislation, while others are adjusted periodically by the Liberia Petroleum Refining Company (LPRC) and the Ministry of Commerce and Industry.
Nuquay specifically criticized the consolidation of regulatory and storage charges. Historically, the LPRC was the sole regulator and storage provider, and the storage fee covered all activities, including testing, vessel discharge, and jetty maintenance. Since private storage tanks entered the sector, the same bulk fee continues to be charged, resulting in private owners benefiting from regulatory fees without providing equivalent services.
Evaporation charges were also cited as excessive. The formula imposes $0.03 per gallon for PMS and HFO, $0.02 for AGO, and $0.03 for JET-A1. Nuquay argued that these rates do not reflect current industry practices and overburden consumers.
The bulk storage fee of $0.35 per gallon, increased by $0.05 in May 2025, was similarly criticized. Nuquay called for the fee to be separated into its constituent components to ensure transparency and fairness in the pricing formula.
In response, LPRC management explained that the current structure inherited by the new team had been partially adjusted. Managing Director Tweah reported reducing financing costs from 4% to 2% of the CIF value for each petroleum shipment. He also noted that evaporation charges are standard practice and are calculated based on reports from LPRC and private tank employees.
Regarding storage, LPRC affirmed that its fee covers all operational and regulatory activities, including testing and vessel discharge. However, private tank owners charge the same amount without providing equivalent services, a point acknowledged by the Senate committee.
The Ministry of Commerce, represented by the Deputy Minister for Administration, stated that it has consistently worked with LPRC to address pricing concerns and is committed to reviewing the formula in collaboration with the Senate.
After hearings and deliberations, the Joint Committee concluded that financing costs remain excessive and should be reduced. Evaporation charges of 1–1.5% of landing costs were deemed too high, and independent verification of evaporation and petroleum quality was recommended.
The committee also found that storage charges are disproportionately high. Globally, industry standards are far lower, with Sierra Leone charging roughly $0.013 per gallon for PMS and Nigeria charging $0.0064 per gallon. Liberia’s current fee of $0.35 per gallon ranks among the highest in the world.
Recommendations from the committee include reducing financing costs to 1% of CIF value, lowering evaporation charges to 0.25%, and revising storage fees to $0.05 per gallon. LPRC services would be itemized in the price formula, including jetty maintenance ($0.14), testing and handling ($0.14), and independent inspection ($0.11).
The committee further suggested redirecting the additional $0.05 added to storage fees to the national road fund, potentially generating over $6.5 million annually for infrastructure across Liberia’s fifteen counties.
The report stresses the importance of separating regulatory, testing, and vessel discharge fees from storage charges to prevent duplication and ensure that private storage tank operators are only paid for services rendered.
Finally, the Joint Committee urged the government to support LPRC in continuing to import, store, and sell petroleum products efficiently, ensuring that pricing is transparent, fair, and in line with global standards.
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