Mon, 01 Jun 2020

The Department of Energy is still researching the feasibility of implementing a fuel price cap, and the outcome will be announced in due course, a spokesperson told Fin24 on Wednesday.

The possibility of a hard price ceiling on 93 unleaded fuel was mooted by Energy Minister Jeff Radebe in mid-October 2018.

A price ceiling would cushion motorists escalating prices. But economists in 2018 already raised concern that, if implemented, it could become a serious drain of state finances.

Fuel price cap research still in progress, says director general

Mokobane said government was also considering de-linking the Road Accident Fund from fuel prices with the new Road Accident Fund Bill, which is still under discussion.

"The Department started with the process to review the fuel pricing formula and the deadline for submission of comments on the Basic Fuel Price review was late March 2019.

"The outcomes of the review will inform the department on the way forward," Mokobane said.

Mokobane said the freeze on the petrol price which South Africa saw in September of 2018 was a once-off intervention at the time to respond to the pressure that previous price increases were placing on consumers.

The government is state to announce its regular monthly fuel price increase next week. According to the AA, unexpectedly high international fuel prices have increased the likelihood of another hike.

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