Pilot project to allow price competition for 93 octane petrol mooted

Focus being put on lowering the price of 93 octane fuel.
Focus being put on lowering the price of 93 octane fuel.

The government is hoping a plan to allow some competition into setting the price of 93 octane fuel will result in lower prices and shift higher numbers of consumers into using it rather than higher-octane 95.

The proposal has been circulated to the fuel wholesale and retail industries‚ which have been asked to comment on it by Wednesday.

It is tentative at this point and best described as a "market-sounding" exercise‚ said government officials.

The move comes as the country faces record-high fuel prices due to a rising oil price and weak rand‚ with the price of 95 octane in Gauteng at R17.08 and 93 at R16.85.

With the exception of diesel‚ fuel prices are regulated at the pump and adjusted each month.

Deputy director-general in the department of energy Tseliso Maqubela said the suggestion was that "the price that we publish every month for 93 will not be a set price‚ but a capped price. What we think will happen is that wholesalers will discount 93‚ which will allow retailers to afford to pass this on to consumers."

Only 20% of drivers on SA roads use 93 octane. As 95 has higher octanes‚ it is less likely to pre-ignite and damage engines.

Maqubela said while this was true for coastal areas‚ it was not true for the higher altitudes in inland provinces. According to manufacturer specifications‚ about half the cars on the country’s roads are able to use 93.

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