Good news on the fuel front is that despite an expected 25 cents per litre hike in the price of petrol and 28 cents per litre on diesel this month (estimated by the AA), diesel is to remain unchanged from last month while petrol – both grades – will rise by a mere 4,9 cents per litre.
This follows a media statement issued by the Department of Energy in which Minister of Energy, Jeff Radebe, said that fuel prices will remain unchanged for this month, except for the 4,9 cents per litre increase on the retail margin of petrol.
The department pointed out that the 4.9 cents hike will cater for the “annual salary increase for forecourt attendants, cashiers and other administration staff. This annual increase is in line with the Motor Industry Bargaining Council agreement reached on November 18, 2016. This money must be ring-fenced for the wages of the forecourt staff.”
Commenting further, the statement said that South Africa has seen “sustained increases in fuel prices for the past few months, which placed a strain on consumers. Despite the fact that these increases were caused mainly by international factors, the department has decided to intervene temporarily for this month. This is a once off temporary intervention to provide some relief to motorists and consumers against fuel price hikes,” the statement said.
The increase will apply to both grades of petrol with effect from September 5. The price of diesel, paraffin and LP gas will remain unchanged.
Talk about a bomb-shell that scattered sweet smelling rose petals instead of the usual shrapnel and this is it. Talking to FleetWatch editor Patrick O’Leary, Layton Baird of the Automobile Association says the announcement is certainly good news for consumers “but I don’t know how this will play out” he says.
“It seems like the price hike has been deferred and we could be 20 cents behind now. This can be made up over a period of months at say 5 cents a litre per month to spread it but the problem is that you’re hedging against the Rand.”
The main issue, he says, is that it is not a petrol or diesel price issue. “It’s an economy issue. We have to fix the economy. If we focus on getting the economy right – and getting corruption and other negative impacts out of the way – then the petrol price becomes secondary. The economy is the big thing and while the Minister’s announcement is a welcomed short term gain for consumers, I’m not sure how it is going to play out over the long term,” he says.
FleetWatch will be following this closely.