‘Too early to celebrate fuel price cut’- Economist

Petrol pump
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Economists have warned that it’s still too early to celebrate the projected fuel price cut next month. Government is still trying to recover money for the slate levy used to subsidise the previous fuel hike.

According to the data from the Central Energy Fund, the price of petrol could drop by R1. 54 a litre, the price of diesel by 92c and illuminating paraffin by 85c.

However, economist Dawie Roodt says motorists may not see the full benefits of the price cuts.

“Under normal circumstances one could have expected the petrol price to be reduced by R1,50 but is not that easy. There is a huge under-recovery on slate levy. It depends on whether the Minister of Finance wants to make up that in one month and it also depends on the Minister of Energy on how much he wants to add on slate levy. I think he will use 20 or 30 cents a liter to be added to the slate levy. So expect a petrol cut of around R1.”