South Africa
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POLL | Do you think government should review the fuel levy amid petrol price hike?

The Automobile Association (AA) is calling on government to review the fuel levy  following the latest fuel price increase ahead of the festive season.

From Wednesday, consumers are expected to pay 81c more per litre of petrol, pushing the price above R20/litre.

The wholesale price of diesel rises 73c/litre for high-sulphur fuel and 75c/litre for low-sulphur diesel, while illuminating paraffin now costs 42c more per litre.

Speaking on 702, AA spokesperson Layton Beard said the association was calling for a review of the fuel levy and a recalculation of all the elements that comprise the fuel price.

“These increases have strengthened the call by the AA for a review of fuel prices,” said Beard.

“We think it is time this happens now. We think people are owed this. Consumers need to understand exactly what is being put into the fuel price so we can look at ways to mitigate against those.”

He said elements that should be looked at to determine fuel prices should include the basic fuel price, levies attached to it, the Road Accident Fund, and possibly privatising the fund.

According to the Central Energy Fund, a weaker rand against the dollar was among the reasons for higher fuel prices.

“The average rand/US dollar exchange rate for the period October 28, 2021 to November 25, 2021 was 15.3891 compared to 14.8175 during the previous period.

“This led to a higher contribution to the basic fuel prices on petrol, diesel and illuminating paraffin by 35.34c/l, 34.44c/l and 34.11c/l, respectively,” it said.

The department said price changes were adjusted in such a manner that the over- or under-recovery during the prior month will be corrected the following month.

“The over- or under-recoveries are rounded up or down to the nearest full cent so the effect of rounding contributes to the clearing of the cumulative balance of the individual products on the slate,” it said.

“To manage a negative balance in the cumulative over/under recovery account, a self-adjusting slate levy mechanism was implemented with effect from January 2009. A slate levy will only be applicable on all petrol and diesel grades if the slate balance is negative (cumulative under-recovery) by more than R250m.”