Smoky Cogs

The news came out today that the price of fuel in South Africa is going up by 34c per litre again beginning of next month, pushing the price over the R8 per litre mark again.

While I could complain for hours about the high fuel prices, there is another something else that I never quite fully worked out. Why does the media in South Africa follow the price of Brent Crude oil.

Whenever the world oil price is quoted on TV, or in the newspapers, or on the radio, the ONLY price that ever gets quoted is Brent crude.

The problem with this is that South Africa does not import much Brent Crude oil. Most of our imports come from the Middle East, with much of the rest coming from Africa. I was reading a report that we may soon be getting large amounts of oil from Angola. And most of this oil sells for a different price than Brent Crude.

Sure, the differences in the prices between regions would not be vastly different, but why aren’t those prices ever quoted? What makes the price of Brent Crude so special?

I think it would be a very justifiable proposition that the price we see in the media for oil, should be the average which we as South Africans are paying for oil, or perhaps a split of the prices which are relevant to us. It would certainly make trying to estimate the next petrol price increase easier.

I am beginning to get a little tired of hearing about the 2010 Soccer World Cup every second of the day. It is great that we, South Africa, are hosting it, but it drives me insane as to how people are just using it as an excuse for everything from marketing campaigns to changing laws.

I encountered a good example this weekend.

Claudia and I were driving through Observatory, in Cape Town, and Claudia told me that she saw a sign at the Engen garage we had just driven past saying that they accepted credit cards to pay for fuel. this lead to a little argument, as the law in South Africa prohibits paying for fuel with credit cards, so I thought she had been mistaken.

As it turns out, I was wrong (and did apologise). It was indeed illegal to buy fuel on credit card. That is why for decades, South Africans have had to have garage cards in order to buy fuel on credit, instead of being able to use their credit cards. This, however, was changed last month, I discovered. The law was amended and it is now legal to buy fuel on a regular credit card, and Engen has been the first fuel retailer in South Africa to begin accepting them.

Now, what has this to do with the Soccer world cup, you may ask? Well, the reason they changed that law to allow credit cards is to make it easier for foreign tourists coming over here next year for the soccer. What makes this event so special that government can change laws like this just for that. I mean, for years we have had to put up with it, and now suddenly we hosting a sporting event, and they able to change it.

Yes, it will make life easier for our tourists, and, heck, it will even make life a lot easier for me, but I really think that the reasons for why it is happening are somewhat flawed.

You can read more from an Engen press release