Molefe Seeletsa

By Molefe Seeletsa

Digital Journalist

Petrol increase now a reality as calls for fuel pricing model adjustment grows

A fuel price increase was announced on Monday, which will see motorists an additional 75 cents per litre for petrol from 1 December.

Motorists will have to dig a bit deeper into their pockets to pay for petrol this festive season.

The Department of Mineral Resources and Energy on Monday announced the fuel price increase while South Africans are still reeling from the news of a new Covid-19 variant, as well as the increase in unemployment.

As of 1 December, petrol increased by *75 cents per litre, diesel by 72.50 and 74.50 cents per litre, and illuminating paraffin by R1.45 per litre.

This will see petrol price for 93 ULP and 95 ULP cost R20.07 and R20.29 per litre, respectively.

It was initially confirmed that petrol will increase to 81 cents per litre, however, it has now emerged that the energy department overstated the price by six cents.

“The Department of Mineral Resources and Energy regrets to announce that the adjustment of petrol price announced on Monday was erroneous.

“The six cents difference is due to the fact that the adjustment of wages for service station workers had already been implemented in September 2021. The rest of the fuel prices are correct,” the department said in a statement on Wednesday.

‘Entirely homegrown’

The decision to increase fuel price has not been met well by many, with the Automobile Association (AA) calling for the fuel price model to be revisited and adjusted.

According to the AA, the price of oil played “almost no part” in the latest fuel increase.

The association also pointed out that 95 ULP has risen by R5.87 per litre, while 93 ULP went up by R5.89 per litre from January 2021 to date.

In the past two months alone, motorists have had to fork out an additional R2 per litre.

“This price disaster is entirely homegrown. Internationally, oil prices have pulled back from their recent highs, and Brent crude is currently trading around $75 a barrel. The majority of this month’s under-recovery is because of the weakening of the rand against the US dollar.

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“The increases year-on-year since December 2020 are astronomical. Petrol has increased by more than 40%, diesel by around 44%, and illuminating paraffin by more than 70%.

“Wages and salaries have not kept pace with these heavy increases, and consumers will undoubtedly be under more financial pressure because of the knock-on effects on other products.

“These increases are severe and will undoubtedly have major negative implications on already financially constrained consumers,” the AA said in a statement.

Fuel capping

The Inkatha Freedom Party (IFP) has since called for an urgent parliamentary debate on rising fuel costs.

Speaking to eNCA, IFP chief whip Narend Singh said the party wants government to explain what it is going to do to cap fuel price increases.

“Government has been tardy in responding to what is happening now because I have been given to understand that from 2018, former minister Jeff Radebe spoke about the capping of fuel prices. And there have been documents and consultations that have, according to government, taken place since then.

“A report should have been given to us in 2019 already, but nothing has been forthcoming and now motorists are going to pay an arm and leg for fuel with the major portion of that fuel price being allocated to the Road Accident Fund [RAF] and general fuel levies,” Singh said.

READ MORE: Tough times are getting tougher, as food prices continue to skyrocket

The DA has also called on government to review the current fuel pricing model.

“It is long past time that South Africa review its fuel pricing. Minister [Gwede] Mantashe is derelict in his duties in this regard. The DA, and others, have on several occasions requested that this review take place, but our correspondence has been completely ignored.

“It has become increasingly clear that the various fuel taxes, such as the RAF levy, are adding to the cost pressures on the fuel cost per litre, which now stand at all-time record highs,” DA MP Kevin Mileham said in a statement.

*A previous version of this article said the petrol price had increased by 81 cents. The energy department has since corrected the figure.