Motorists may be celebrating a huge fuel saving in May, with the petrol price looking set to drop by about 55c a litre.
Motorists may be celebrating a huge fuel saving in May, with the petrol price looking set to drop by about 55c a litre.
However, according to , motorists should not get too happy as the Fuel Retailers’ Association, which represents the petrol stations, wants the government to put some of the decrease into the equalisation fund. This fund is empty at the moment and is used to keep fuel prices stable.
The executive director of the association, Peter Morgan, told the newspaper that the full decrease could not be transferred to motorists as this would result in many petrol stations going out of business. He explained that the average petrol station needed to sell about 300 000 litres of petrol a month to break even.
He said many petrol stations would have to turn the stock they had 12 times in May to just ensure they stayed in the same financial position they were at the beginning of the month. Morgan said petrol stations made a net 3c to 4c profit on every litre sold.
