SA’s fuel price goes up despite the government’s levy cutback – but retailers soon able to sell for less (Dailymaverick)

From 1 June, retailers will be allowed to sell 93-octane unleaded petrol below the price cap which the government sets. For decades, the government has set a price that petrol retailers were required to sell at and no discounts were allowed. The price was set according to a calculation based essentially on the oil price. The question is whether or not retailers will take the opportunity to do so. Petrol retailers contacted on Tuesday said they had not yet had a chance to discuss the issue. The new system has clearly taken petrol retailers by surprise. On the one hand, with petrol prices now at record highs, any retailer that sells below the price cap will get massive kudos from customers. But on the flip side, the entire petrol retail industry has worked on the basis of what comes down to a set profit. Their business plans have been built around this system. This has had some odd results. One is, arguably, a massive oversupply of petrol stations in SA.  Click here to read full article