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The Energy Department of South Africa has proposed changing the basic fuel price structure in the country to reduce the costs of gasoline and diesel.
The proposals plan to make Singapore the main reference market for the base price of gasoline, diesel and kerosene, to remove a premium on the freight rate and reduce the coastal storage element in the calculation.
The base fuel price is just under half of the retail price of gasoline, which is regulated by the government and is determined by changes in international prices and the rand exchange rate.
The proposals published in the Official Journal for comments make no mention of the changes in taxes and levies representing almost one third of the retail price of gasoline.
The retail price of gasoline has risen 22% over the past year, peaking at an all-time high in October, which is putting additional pressure on consumer spending and fueling inflation.
While Energy Minister Jeff Radebe reportedly announced that the government will finalize its proposals to cap the price of gasoline to 93 octanes by the end of January, Finance Minister Tito Mboweni said he is managing the liability of his deficit road accident fund.
Read: South Africa could experience its biggest gas price reduction in December
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