The government has limited options to cushion the blow of a record petrol price hike in April beyond taking a financial hit, says the South African Petroleum Industry Association (SAPIA).

SAPIA is a trade group that represents South Africa’s major petroleum retailers and refiners including Astron Energy, BP, Engen, Shell and Sasol.

In a presentation to parliament on Friday (25 March), the association noted that the country’s petrol price is currently heavily regulated by the Department of Mineral Resources and Energy, with each component of the basic fuel price tightly apportioned to areas such as transport, refining and oil costs.

As such, it warned that there is little that the country’s petrol stations and its other members can do to alleviate price hikes without impacting the security of the supply of petroleum products or jeopardising the sustainability of the industry.

The exception to this: the various levies and duties that are currently added directly to the fuel price by the government, including the fuel levy and the Road Accident Fund (RAF) levy, the association said.

While a long-term review of the fuel price should be undertaken – and was needed – the group said that the government will need to take a financial knock in the coming months if it plans to officially soften the petrol price.

It added that funds that would typically be collected from the fuel levy and the RAF levy would then have to be found elsewhere to help balance the national budget.