Probe launched into fuel shortage

By: CAR magazine

Minister of minerals and energy Lindiwe Hendricks has launched a probe into the recent fuel crisis that affected many motorists making their way to their holiday destinations.

Minister of minerals and energy Lindiwe Hendricks has launched a probe into the recent fuel crisis that affected many motorists making their way to their holiday destinations.

Marumo Moerane, the deputy chairman of the competition tribunal, has been instructed to head the commission that will advise whether regulations are required to prevent a repeat situation.

Most of the topics that will be explored in the investigation relate to the factors that may have caused, or contributed to, the fuel shortages.

A key point in the investigation will be whether the oil companies, who are obliged to hold processed fuel stocks, defaulted. Last week, Hendricks noted that oil companies were paid 3,8 c a litre from the basic fuel price to store fuel reserves for 25 days. It will also be discussed whether consumers should be compensated for the inconvenience.

Also under investigation are the way which the switch to cleaner fuels is being handled (ahead of the January 1, 2006 deadline), further plans to shut down refineries before next year, refining capacities, and panic buying by consumers.

Other issues likely to be probed are delays by fuel retailers in ordering supplies to take advantage of price reductions, and whether anti-competitive practices could have contributed to the shortage. The likelihood of a repeat fuel shortage will also be explored.

Moerane said he planned to start the investigation as soon as possible.

Colin McClelland, the director of the SA Petroleum Industry Association, which represents the country’s seven oil refiners and fuel producers, welcomed the probe.

“The industry would welcome clearing the air,” McClelland told . “If there are problems, let’s move forward to solving them. It’s a good thing to have a decent investigation every now and then,” McClelland said.

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