Efforts to cap and bring down the escalating cost of fuel are being intensified by the Department of Energy according to minister Jeff Radebe.
Making the announcement during a briefing of the Portfolio Committee on Energy in Cape Town yesterday, he said that government’s focus would be on interventions aimed at turning the situation around.
“In the short term we have had to intensify our fuel saving measures, we have had to intensify our engagements with oil producing countries with a view to indicating to them the impact of high crude oil prices on developing economies and we’ve also had to try to obtain pricing regimes that would be [favourable] to our economies,” said Radebe.
He noted that the Organisation for Petroleum Exporting Countries, along with the Russian Federation, had decided to cut oil production by 2% to eliminate the oil glut in the market which was keeping prices of crude oil very low. This has led to the more than doubling of oil prices over the last two years and as a non-oil producing country, South Africa must accept the price of crude oil as determined by the international market.
“There are technical teams from the Department of Energy and National Treasury that have started to work on the review of the fuel price structure to see whether any adjustments can be made,” Radebe added. “We have to finalise the framework for the exploration of oil and gas [so that] we can have better control of fuel [prices] through domestic production of fuel and gas.”
