PitStops

The long wait for petrol deregulation

 

As the price of petrol continues to soar, motorists are eager to know when the promised outcome of a decision by energy minister Gwede Mantashe in July last year to “introduce a price cap or maximum price for 93 octane” (unleaded), will materialise.

 

In fact, the wait goes as far back as 1998, where there was a policy shift towards market related pricing – but which never materialised. Instead, regulated margins have increased over the last 20 years.

 

The public was given 30 days to comment on Mantashe’s notice, but one year later, his department has yet to comment on the more than 400 stakeholder submissions received.

 

In May, he said the submissions “are still under discussion internally", but gave no time-frame for when the outcome will be communicated to stakeholders, nor did he offer any indication what considerations would be entailed in how the price cap might be set.

 

Mounting pressure

 

The long delays since the announcement would indicate that the Minister is being driven into the move reluctantly, but pressure has been mounting. In 2019, Treasury pushed for a review of fuel price regulation. Again showing his support for deregulation, Finance Minister Enoch Godongwana said that motorists can even expect "full deregulation of the price of both 93 and 95 prices in time.”

 

The DA’s submission in July 2022 of a bill to deregulate the petrol price will no doubt help to speed up the process, but this will have to wait until Parliament’s annual budget sitting in February 2024. If the average bill takes up to six months to be passed into law, consumers could expect the price of gasoline to be deregulated by September 2024, if the bill is passed.

The DA is also currently running a petition to deregulate the price of fuel. www.slashfuelprices.co.za

 

How much money could deregulation save motorists?

 

Depending on who is asked, motorists could save anything from Solidarity Research Institute’s R2.28 per litre estimation, to the DA’s hopeful peg of R9.00 a litre, if petrol were to be deregulated.

 

“Either way, deregulation of the petrol price would be great news for owners of petrol vehicles,” says Diederik van ’t Hof, developer of PitStops, a popular app that helps drivers find the cheapest diesel service station in their area.

 

“South Africans are facing enormous financial pressure, and the high cost of fuel, together with high interest rates and food costs, are seeing millions of people struggling with debt. If they could enjoy the same benefits as diesel drivers and fill up with the cheapest fuel wherever they are located, it would be a step forward in being able to manage their costs more effectively.

 

The PitStops App is available on all mobile phones. To register, go to www.pitstops.co.za