Durban - South Africans should be paying around R8 for a litre of fuel instead of R16, claimed an organisation driving a national campaign for petrol price reductions.
Visvin Reddy, national convener of People Against Petrol and Paraffin Price Increase (Papppi), said motorists’ petrol bills would be halved if they could buy fuel from Sasol at a fair rate.
According to Sasol’s financial report, released in 2017, it cost the company R2.71 to produce a litre of fuel, he said.
“If the government included the more than R5 in taxes and levies to the present fuel price in Sasol’s cost, we would pay around R8 a litre. It is daylight robbery that we pay double for Sasol fuel in South Africa,” Reddy added.
He asked why motorists had to pay the same for Sasol fuel as other imported brands, as it was produced locally.
“Sasol is not affected by the price of Brent crude oil, the rand-dollar exchange rate or transports costs, so why is government pricing Sasol fuel the same as the others?
He warned: “If this matter is not addressed urgently, we will approach the Competitions Tribunal of South Africa and charge the government with price fixing.”
Papppi was ignited when the government announced its 85-cents-a-litre fuel hike early in June, “the biggest price increase we’ve experienced as a country. The increase moved the price of fuel near to R16.
“We’ve already had five increases this year and political parties have been silent. Something needed to be done because this affected the poor people the most,” he said.
Papppi’s planned national picket on July 2 did not reach the heights it anticipated and its planned countrywide mass action for Friday was aborted at the 11th hour.
Reddy said they had received a request from President Cyril Ramphosa’s office to attend a meeting in Johannesburg on Thursday, to discuss concerns and “we therefore put our mass action plans on hold because we did not want to be accused of not giving the government an opportunity to engage with us”.
However, at a Sandton restaurant, he and his delegation were informed by Ramaphosa’s advisers that the president was not able to meet them due to his BRICS obligations.
“We met the advisers and were told that a special cabinet ‘lekgotla’ was planned for Tuesday, where the VAT rate and the petrol price would be discussed. We were told that the government also planned to zero-rate more food items,” Reddy said.
“When we shared our views on Sasol and how it could be the solution to the country’s petrol price problems, the president’s representatives were startled.
“They have since promised to facilitate a meeting with us and the ministers involved with the fuel price to discuss the Sasol idea,” he said.
Reddy warned that if they were “not taken seriously, we will call for massive shutdowns around the country”.
He added that his organisation would champion for the nationalisation of Sasol, which would be pivotal in drastically reducing the petrol price.
“We have been told that the country has coal reserves that will last for 150 years, so we must dip into our natural resources and build more refineries. It would improve the country’s economy and the lives of people.”
Meanwhile, Pick * Pay chairperson Gareth Ackerman continued the call for the deregulation of the petrol price - much like his father, Raymond, the founder of the company, who did so from the 1970s but without success.
“Consumers in South Africa are and have been under considerable pressure. The cost of petrol has a knock-on effect that, together with other increases, is putting them under even more strain.
“We continue to believe that the petrol price should be deregulated. It remains one of the only consumer products with price maintenance. Competition should always be encouraged and especially with such an important commodity,” he said.
“Deregulation would bring competition in margins. The fuel levy was originally intended to improve road infrastructure,” Ackerman added.
Sasol spokesperson Russell Johnson, however, said: “Saying that it costs us R2.71 to produce fuel is speculative.”
Of Sasol building more refineries to accommodate South Africa’s fuel demand, he said: “Our long-term strategy is that we will not be increasing our refining capacity.”