How SA’s fuel pricing policy is keeping us stuck in the past
BMI Research says SA will become increasingly dependent on imported fuels, as ageing refineries cannot supply the fuels modern cars need
Allowing the government to set the petrol price once a month is keeping SA’s cars and fuels stuck in the past, BMI Research warned in a note released on Tuesday morning.SA had to indefinitely delay its plan to introduce Euro V fuel standards in July because the profitability of local refineries is too low for them to recoup the investment required to upgrade their plants.Since modern cars are increasingly designed to run on the cleaner fuels that SA’s ageing refineries cannot produce, the country’s dependence on imported petrol and diesel will grow."Increases to the new vehicle emissions tax last year will promote the sales of more modern and efficient vehicles. However, domestic refining capacity will be unable to meet the demand for higher-quality fuel," the report said. "As a result, SA will face a higher import burden for higher-quality fuel. This poses additional headwinds to domestic refiners due to the increasing competitiveness of fuel imports. "A build-out in global product...
Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.
Please read our Comment Policy before commenting.
Subscribe now to unlock this article.
Support BusinessLIVE’s award-winning journalism for R129 per month (digital access only).
There’s never been a more important time to support independent journalism in SA. Our subscription packages now offer an ad-free experience for readers.
Cancel anytime.
Questions? Email helpdesk@businesslive.co.za or call 0860 52 52 00. Got a subscription voucher? Redeem it now.