The Liquid Fuels Wholesalers Association (LFWA) has successfully requested the Minister of Mineral and Petroleum Resources Gwede Mantashe to temporarily rezone the Nelson Mandela Bay (NMB) metro and surrounding areas as an “inland region” with respect to fuel prices.
This comes after the equipment used to transfer fuel to tanker trucks in the Port of Port Elizabeth (PE) suffered damages that left it in a non-functional state.
In June 2024, a fuel tanker arriving at the PE harbour was thrust into a bunker that usually facilitates the off-loading of imported fuels, rendering it completely out of commission.
Ever since, liquid fuel wholesalers had to reroute their fuels to the East London harbour some 300km further South, meaning a round-trip added another 600km to their tanker trucks’ odometers. They also had to procure additional trucks to maintain a consistent supply to their customers.
The LFWA consequently applied to rezone the NMB region to an “inland region” until further notice in an attempt to recoup the losses of its members.
“Our problem is that there is nowhere we can pass on these huge extra transport costs,” LFWA CEO Peter Morgan told Daily Maverick.
Should the interim relief measure not be granted, “we will no longer supply the Nelson Mandela Bay region. We can’t afford it any more,” he said.
In the latest announcement regarding October’s official fuel price adjustments, Minister Mantashe approved the implementation of revised transport tariffs into the petrol and diesel price structures for the NMB region as an interim measure until the PE harbour is back up and running.
The adjustment to the road transport tariffs applicable to petrol and diesel ranges from a decrease of 0.9c/l in Zone 9A to an increase of 10.5c/l in Zone 8B.
Therefore, depending on the zone, NMB residents will be paying anywhere from 33.60c/l (Zone 4A) to 114.40c/l (Zone 7A, 8A, 9A) in transport tariffs when buying a litre of fuel starting 2 October for the foreseeable future – equalling inland transport tariffs for land-locked provinces.
Port Elizabeth Harbour. Image: Africa Ports & Ships
The people of NMB pays the price
The NMB Business Chamber has written to Minister Mantashe in an effort to reverse the relief measures, arguing that his department should instead implement an equitable solution that addresses the concerns of the LFWA but does not unfairly disadvantage local businesses and residents.
“Nelson Mandela Bay businesses and residents must not be penalised with higher fuel prices, to compensate fuel wholesalers for additional costs of trucking fuel to the metro, due to repairing of the fuel berth in the Port of Port Elizabeth by Transnet,” said NMB Business Chamber chief executive Denise van Huyssteen.
“While we accept that the LFWA’s members are in the untenable position of incurring additional costs that they cannot recover, it is blatantly unfair to transfer this burden onto the shoulders of the people and citizens of Nelson Mandela Bay.”
The Eastern Cape economy is in recession and has amongst the highest unemployment rates in the country.
This fuel price intervention is of grave concern for the municipality given the potential knock-on effects on food and transportation costs, as well as the costs of doing business.
Transnet indicated that the port may only be fully operational again in January 2025 as it is currently in the process of appointing a service provider for the repairs.
“While the LFWA argues that the increase to inland fuel pricing will be ‘but a small fraction’ of the October price reduction, it remains unacceptable that businesses and residents in the metro should pay the price for a problem not of their making,” concluded Van Huyssteen.
“Transnet must expedite the repairs with the necessary urgency and in the meantime the ministers of Transport and of Mineral Resources and Energy need to find a workable solution to address the cost concerns and the delivery of fuel to a city with two ports.”
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