Petrol Prices Set for Massive Increases Due to Looting and Rioting in SA

1 year ago 3847
Sourced from the South African

The Automobile Association (AA) of South Africa says new data is suggesting that petrol prices in the country will increase by a huge 87 cents to the litre. This comes as the fuel industry has been ‘hammered from all sides’ during the weeklong unrest that gripped the country in the last several days.

Fin24 reports that the AA, which doesn’t regulate or adjust fuel prices in SA, publishes two fuel outlooks per month based on data issued by the country’s Central Energy Fund.

The association said in a statement on Wednesday that in addition to the fuel price hike forecast, diesel is also expected to rise by 58 cents per litre and illuminating paraffin by 56 cents.

“Fuel prices were already trending higher before the widespread looting and unrest of the past few days. But now, the daily rand-US dollar exchange rate has spiked from R14.35 to nearly R14.80 since 12 June,” the AA states.

The AA said further that South Africa imports a lot of fuel, which will inevitably cost more in Rand terms. Meanwhile, international oil prices remain on the increase, adding further pressure.

AA Calls for Limiting of Non-Essential Transport

Due to this, the AA has called for motorists to limit all non-essential travel as road transport comes under pressure from the unrest and the possibility of fuel shortages. The SA Petroleum Industry Association (SAPIA) has also cautioned against the panic buying of fuel, saying that the availability of petroleum products in the country was currently stable and that panic buying could lead to shortages.

SAPIA, which represents the interests of the petroleum industry and whose members include PetroSA, Engen Petroleum, Sasol Oil, and BP Southern Africa, amongst others, issued a statement on the impact of unrest on operations for the businesses it represents.

The petroleum industry association raised concerns over the looting of fuel from retail service stations sites, as well as the filling of plastic containers with fuel – both activities, it says, pose a serious safety risk.

“As this is a fluid situation, assessments and decisions are being made on an hourly basis. SAPIA is actively engaging with the Department of Mineral Resources and Energy (DMRE) to ensure that adequate supply to the market is maintained,” it said.

Buying Fuel in Containers Outlawed

According to Fin24, buying fuel in a container, as opposed to filling up a vehicle, has been made illegal in South Africa after the unrest.

The new regulations that prohibit retail sales of petroleum products to members of the public in portable containers were announced by the DMRE on Thursday.

Regulations were put in place to control any rampant panic buying of fuel or possible arson attempts.

In the same statement, the department said that the temporary closure of the SAPREF (Shell and BP South African Petroleum Refineries) refinery in Durban – the largest crude oil refinery in the country – will have a significant ripple effect across the national supply chain for petroleum products.

By Luis Monzon
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