The Minister of Mineral Resources and Energy, Gwede Mantashe, has warned South Africa that the international crisis between Russia and Ukraine could possibly lead to more increases in petrol prices.
During the debate on the State of the Nation Address (SONA) on Tuesday, Mantashe said. “We should pay attention to the developments between Western countries and the Russian Federation on the Ukraine matter, in so far as it impacts crude oil prices.
“This could result in huge increases in fuel prices globally and negatively affect local consumers and transport users.”
And the Brent Crude oil price has already dropped significantly amid reports about tensions over Ukraine.
“South Africa’s local petrol price is heavily weighted based on international oil prices and the buying power of the rand, with the rising crude price pushing petrol 95 above the R20/litre mark once again at the start of February.”
Minister Mantashe calls out BP and Shell
During his speech, Minister Mantashe also criticised BP South Africa and Shell Downstream South Africa after their announcement that operations will be paused at the South African Petroleum Refineries (Sapref). The Durban-based refinery will be paused by the end of March 2022.
Both BP and Shell are shareholders of the refinery and they will be implementing a “spending freeze” while they attempt to find a buyer for the refinery. This decision was made after consulting with the government, unions, and Sapref employees.
“The greed and arrogance of certain petroleum entities that want to shut local refineries and import the product, something that will cause job losses to our people, cost our economy dearly, and lead to uncertainty of supply.
“For our national and economic security, we are taking drastic measures in this regard,” Mantashe said.