How petrol prices are calculated in South Africa

The petrol retail price is regulated by government and is adjusted  every  first Wednesday of the month. The calculation of petroleum product prices (petrol, diesel and illuminating paraffin) is done daily by the Central Energy Fund (CEF) on behalf of the Department of Mineral Resources and Energy (DMRE). The monthly price change which is made is essentially an average over a prior period applied to the future month.  This means that South Africa fuel prices lag international prices by one month.

The petrol pump price is composed of a number of price elements which can be divided into international and domestic elements.  The international element, or Basic Fuel price (BFP), in its simplest form is based on what it would cost a South African importer to buy petrol from an international refinery and to transport the product meeting local specification to South African shores.  To this is added various government regulated taxes and levies and allowable margins to arrive at a fully built up price for petrol.  Within this price build up are charges for NERSA operations and allowable distribution charges based on magisterial district zoning.  The diesel retail price is not regulated although the DMRE presently publishes a wholesale list price for diesel.