Durban price shock: Fuel station owner makes U-turn on R29.85 diesel
Two Durban fuel stations cut diesel prices after backlash over a spike to R29.85.
Two Durban fuel stations have had to make a temporary U-turn on diesel price hikes after an angry backlash from motorists.
Earlier this week, video clips were widely circulated on social media showing diesel prices climbing to R29.85 at an Astron Energy garage in Woodview, Phoenix, and an Engen in Umhlathuzana, Chatsworth.
Both stations are owned by the same individual.
The owner, who spoke to Newswatch, said the decision to raise costs follows concerns over possible fuel price increases and supply disruptions linked to the global oil crisis triggered by the ongoing US-Israeli conflict with Iran.
Chairperson of the Woodview Ratepayers Association, Theo Pillay, says residents began sharing their concerns over the weekend.
ALSO READ: No fuel shortage in South Africa, authorities urge calm
He says that while the price increase was alarming, residents felt there should also have been better communication about the sudden hike.
"People were complaining on our WhatsApp group that the prices increased, and they couldn't get clarity. But they are up in arms, and they’re totally upset. I approached the manager and asked him to issue a public notice to this effect, and he said he will do that.
"Our community is facing hardship, and I think service providers like this should be talking to us and looking at the logistics of the price increases. Yes, we understand there's going to be a price increase, but also the fuel regulators should be advising the community as well," says Pillay.
Fuel station owner speaks
In a response to Newswatch, the owner says their supply remains under pressure due to the ongoing global conflict.
He says following the public's reaction, a decision was made to temporarily lower the prices to ease concerns and allow customers to better understand that their actions were above board.
“After [the] video we adjusted down temporarily until people understand our actions are lawful,” says the owner.
Diesel, unlike petrol, is deregulated in South Africa.
The owner says pricing decisions can legally be made at an operational level, including by senior management such as a “general manager or chief operating officer”.
ALSO READ: Middle East conflict threatens South Africa’s economic recovery, warns SACCI
Power and energy expert Professor Vally Padayachee explained that the retail price of petrol is regulated by the government and that the retail price of diesel is not.
"The Department of Minerals and Petroleum Resources regulates the wholesale list price of diesel, which consists of the basic fuel price, plus levy and taxes. That is done to manage the market condition. Otherwise, the diesel price will go through the roof.
“It means that there's retail freedom when it comes to diesel. The diesel price gets set - I would argue because of competitive reasons."
Current diesel prices
According to the Automobile Association, the wholesale price of diesel 500 ppm is currently R17.70 on the coast, while it's R18.53 in inland regions.
The fuel station owner says his business remains stable, and much of the coverage on social media is misinformation.
He says no customers are being “robbed” or exploited, adding that motorists are free to decide whether or not to purchase fuel.
Newswatch has asked Astron Energy and Engen for comment on whether other franchises have taken similar action and whether any pricing guidance has been issued.
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