R10-Billion Fuel Levy Gives Motorists Only 1c Petrol Relief at the Pump

South African motorists will see almost no drop in petrol prices this month, despite a R10-billion temporary fuel levy cut announced by Finance Minister Enoch Godongwana. Petrol will fall by just 1 cent a litre from Wednesday, while diesel prices will drop by between R1.09 and R1.19 a litre.

The levy relief was set out in the Medium-Term Budget Policy Statement last month. From 4 November until 1 December, the general fuel levy will be reduced by R1.50 a litre on petrol and by R3 a litre on diesel. After that, smaller cuts of R1 a litre on petrol and R1.50 a litre on diesel will stay in place until early January. The government is funding the R10-billion measure by returning money previously transferred to the Central Energy Fund.

Many drivers had hoped for bigger savings after the announcement. However, other costs have largely cancelled out the benefit on petrol. Global oil prices remain high because of ongoing conflict in the Middle East that has disrupted supplies. The rand has also weakened against the dollar, which makes imported fuel more expensive. On top of that, the slate levy – a charge that covers past under-recoveries – has risen by more than 48 cents a litre.

As a result, the regulated pump price of both 93 and 95 unleaded petrol will edge down by only 1 cent a litre. Wholesale diesel prices, which are not controlled at the retail level, will fall more sharply. Illuminating paraffin and LP gas prices are set to rise.

Officials say the levy cut has still helped motorists. Without it, petrol and diesel prices would have increased this month because of the higher international costs and the weaker currency. The temporary measure is meant to ease pressure on household budgets and businesses while the government manages its finances.

The relief will not last beyond early January. After that, fuel prices will once again be driven mainly by oil markets and the rand. For now, diesel users will notice the difference at the pumps, while most petrol drivers will see almost no change. The Department of Mineral and Petroleum Resources confirmed the final price adjustments on Tuesday.

Source: https://x.com/eNCA/status/2117578371936755846

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