A pump notice at a fuel station in Cape Town on Thursday. There has been an increase in fuel stations without diesel ahead of Wednesday’s price hike, with panic buying in some areas.
- More fuel stations have run out of diesel amid panic buying ahead of Wednesday’s record price hike.
- SA’s two biggest farming organisations now want government to change fuel prices immediately.
- They believe this will bring some stability.
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With three days to go before record fuel price hikes, more forecourts are running out of diesel.
SA’s two biggest farming organisations, AgriSA and Agbiz, now want government to change fuel prices immediately, rather than wait until Wednesday. They believe this will bring some stability.
Avhapfani Tshifularo, executive director of the Fuel Industry Association of SA, told News24 that there has been an increase in fuel stations without diesel ahead of the price hike, with panic buying in some areas.
“Above‑normal service‑station demand is contributing to current supply tightness, while limited road tanker availability is adding pressure. This has resulted in delivery delays and intermittent stock‑outs in several regions.”
An AgriSA and Agbiz survey among farmers and fuel retailers over recent days shows rationing and low supply in many regions.
“These constraints are beginning to affect normal farming and agribusiness operations at a critical time in the production cycle,” they said in a statement.
The Northern Cape is especially hard hit, with fuel stations in Kakamas and Upington reporting that they don’t have diesel. Independent fuel stations in small towns in the Western and Eastern Cape, as well as in parts of KwaZulu-Natal, have reportedly also been badly affected, with rural fuel stations in Mpumalanga and the Free State telling News24 that they have diesel sale curbs in place, ranging from 40 to 100 litres per customer.
Fuel1, a company that owns seven forecourts in the Western Cape and specialises in supplying trucks, ran out of diesel at all its locations earlier this week.
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Government has received reports of fuel suppliers holding onto their stock in anticipation of price increases next week, Minister of Minerals and Petroleum Resources Gwede Mantashe said this week.
On Wednesday, the diesel price is expected to be hiked by more than R10 a litre, and 95 unleaded petrol by more than R5.80.
To stabilise the situation, AgriSA and Agbiz want “an immediate, out-of-cycle fuel price adjustment to better reflect current market conditions”.
In South Africa, the retail price of petrol and wholesale diesel prices are only adjusted once a month, meaning importers and wholesalers must absorb sudden increases in global prices until the next adjustment.
The Competition Commission on Friday warned diesel sellers that they can’t hike retail prices in anticipation of the wholesale price hike. “They may only increase prices once they experience actual fuel cost increases.”
Fuel industry players say the monthly set prices discourage suppliers from bringing in additional cargoes, increasing the risk of shortages.
They argue that more flexible pricing mechanism would allow the pump price to move more frequently, even daily, and help importers recover costs and continue bringing in supply.
Apart from an immediate adjustment, AgriSA and Agbiz want government to adopt more regular reviews, instead of the standard monthly adjustment, during this current volatile period.
“This is in line with what associations representing fuel retailers has also asked for. These measures are not intended to increase costs to the sector, but rather to ensure that pricing reflects underlying conditions more accurately, thereby reducing incentives for panic buying or supply withholding,” the organisations said.
The price increases come as the ongoing conflict in the Middle East has pushed oil prices northward – from about $73 a barrel before the US and Israel launched coordinated attacks on Iran to more than $100 a barrel. Brent crude oil surged to $114 on Friday after the US and Israel bombed Iranian nuclear and steel facilities.