Mercedes Mullins
South Africa's fuel consumption is a complex issue. With 11 million vehicles on the road, South Africans spend a significant portion of their income on fuel, and the country aims to reduce its greenhouse gas emissions in the coming years. South Africa's fuel economy is influenced by various factors, including vehicle types, fuel prices, and government policies. While there has been a decrease in light-duty vehicle (LDV) sales and an improvement in fuel economy for some vehicles, the country still faces challenges with increasing fuel prices and emissions reduction targets. Understanding South Africa's fuel consumption involves examining these factors and their impact on the country's energy landscape.
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What You'll Learn
South Africa's fuel consumption and types
South Africa's fuel consumption and sources are heavily influenced by its vehicle market and energy policies. With 11 million vehicles on the road, the country experiences significant fuel usage. South Africans consume approximately 11.1 billion litres of petrol and 12.1 billion litres of diesel annually, with a total annual fuel consumption of around 27 billion litres from 2017 to 2019.
The country has seen a decrease in light-duty vehicle (LDV) sales since 2017, with 503,000 LDVs sold in 2019. Despite this, SUVs and pickup trucks dominate the LDV market, constituting a 49% sales share in 2019. The average fuel consumption of new LDVs decreased by 1.3% per year between 2005 and 2019, reaching 7.4 litres of gasoline equivalent per 100 kilometres in 2019. However, this is still 2.8% above the global average.
In recent years, South Africa has experienced increasing fuel prices due to a depreciating local currency and rising international oil prices. The Basic Fuel Price (BFP) has surged by an average of 87% over the last 45 months. Additionally, the country's fuel levy and Road Accident Fund (RAF) levy, the two largest taxes on South African fuels, have also contributed to higher prices. Despite these increases, South Africa still enjoys relatively cheaper fuel prices compared to most other countries.
South Africa's vehicle market dynamics influence fuel consumption trends. Sales of city cars have remained strong, while the market for medium and large cars has contracted. Diesel sales shares have grown, reaching 35% in 2019, while gasoline LDV sales have shrunk. However, the uptake of electric, plug-in, and hybrid vehicles remains minimal, with a combined sales share of less than 1% in 2019.
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Fuel price and tax
South Africa's annual fuel consumption from 2017 to 2019 remained constant at around 27 billion litres. The country is aiming to reduce its greenhouse gas emissions to 398–510 MtCO2e by 2025 and 350–420 MtCO2e by 2030, as per its latest Paris Agreement Pledge.
In South Africa, about 25% of the price paid at the pump goes directly to taxes. The General Fuel Levy (GFL) and the Road Accident Fund Levy (RAF) are the biggest chunks. The Fuel Levy in the price structure of petrol and diesel amounts to 396 c/l and 384 c/l, respectively, as of April 1, 2024. The Road Accident Fund Levy in the price structure of both petrol and diesel amounts to 218.0 c/l.
Differentiated vehicle registration taxes introduced in 2010 helped improve average fuel consumption. However, the lack of fuel economy or CO2 emissions standards for light-duty vehicles (LDVs) in South Africa is notable. Instead, the country has imposed consumer fuel economy and CO2 emissions labelling since 2008.
The average South African pays R320 in taxes when filling up a 50-litre tank with 95 octane fuel. This is based on a fuel price of R25.49 per litre for 95-octane unleaded petrol. Other costs associated with the petrol price include transport costs, customs and excise duties, retail margins, and secondary storage costs.
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Fuel economy
South Africa's fuel economy is a complex issue. The country has one of the cheaper fuel prices in the world, but this is relative to neighbouring countries, and prices have been increasing. South Africa's fuel prices are affected by the taxes levied on them, such as the Fuel Levy and the Road Accident Fund (RAF) levy, which are usually set in the annual budget. The Fuel Levy was increased by 7% to R3.37, and the RAF levy by 18% to R1.93. These two levies are the largest taxes on South African fuels, accounting for over 90% of the total levies. The exchange rate between the rand and the US dollar has also impacted fuel prices, with a depreciating local currency leading to higher fuel prices. The South African rand has fallen significantly against the US dollar in recent years, which has increased the Basic Fuel Price (BFP) at which the country buys propellants from other countries.
The increase in the price of Brent Crude oil since the pandemic has also played a role in rising fuel prices in South Africa. Oil prices have increased from $52 per barrel in March 2020 to $80 per barrel in December 2023, making the liquids more expensive to buy and produce. The combination of a poor performance of the South African currency and rising oil rates has resulted in an average 87% increase in the BFP over the last 45 months.
Despite the increase in fuel prices, South Africans still spend a significant portion of their income on fuel. According to Bloomberg, motorists spend 5.98% of their daily income on one litre of fuel. On average, South African motorists spend 3.31% of their salary on 202.07 litres of petrol per year. With 11 million vehicles on the road, this amounts to a considerable amount of fuel used annually.
In terms of fuel consumption, South Africa has seen a decrease in light-duty vehicle (LDV) sales since 2017, with 503,000 LDVs sold in 2019. The average fuel consumption of new LDVs decreased by 1.3% per year between 2005 and 2019. In 2019, the average fuel consumption of LDVs was 7.4 litres of gasoline equivalent per 100 kilometres, which is 2.8% above the global average. SUVs and pick-up trucks dominate the LDV market in South Africa, with a sales share of 49% in 2019. The sales share of small SUVs and pick-up trucks has been increasing, while the market for large and medium cars has contracted.
South Africa has taken some steps towards improving fuel economy and reducing emissions. Differentiated vehicle registration taxes introduced in 2010 have helped improve average fuel consumption. Additionally, the country has imposed consumer fuel economy and CO2 emissions labelling since 2008. However, there is still a minimal uptake of electric, plug-in, and hybrid vehicles, with a combined sales share of less than 1% in 2019. South Africa is also committed to reducing its greenhouse gas emissions under the Paris Agreement Pledge, aiming for 398–510 MtCO2e by 2025 and 350–420 MtCO2e by 2030.
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Fuel consumption by vehicle type
Fuel consumption in South Africa is largely driven by vehicle use, with an estimated 11 million vehicles on the road. The country consumes around 11.1 billion litres of petrol and 12.1 billion litres of diesel annually, according to official figures.
In 2019, South Africa's annual fuel consumption was approximately 27 billion litres, remaining fairly constant from 2017 to 2019. This decreased significantly to 23.19 billion litres in 2020 due to the COVID-19 pandemic and the resulting reduction in demand for fuel during the national lockdown. As lockdown measures eased in 2021, fuel consumption increased to 25.18 billion litres.
Breaking this down by vehicle type, light-duty vehicles (LDVs) account for a significant portion of fuel consumption in South Africa. In 2019, LDVs had an average fuel consumption of 7.4 litres of gasoline equivalent per 100 kilometres, which is slightly above the global average. Within the LDV category, SUVs and pick-up trucks dominate the market with a sales share of 49% in 2019. The sales share of small SUVs and pick-up trucks has been increasing, while the market for large and medium cars has contracted.
South Africa has implemented measures to improve fuel economy and reduce emissions. Since 2008, a labelling system has been in place, requiring all new passenger vehicles to display their fuel efficiency and corresponding carbon dioxide emissions. Differentiated vehicle registration taxes introduced in 2010 have also helped improve average fuel consumption. However, the uptake of electric, plug-in, and hybrid vehicles remains minimal, with a combined sales share of less than 1% in 2019.
To further reduce fuel consumption and emissions, South Africa could consider increasing the share of diesel vehicles in the market, as diesel vehicles tend to be more fuel-efficient than their petrol counterparts. Additionally, policies such as increasing fuel prices or providing incentives for cleaner, more fuel-efficient technologies can disincentivize private vehicle use and encourage the adoption of more efficient vehicles.
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Fuel consumption and income
South Africa's annual fuel consumption has remained relatively stable in recent years. Between 2017 and 2019, the country consumed around 27 billion litres of fuel annually, including petrol, diesel, jet fuel, and other types of fuel. This stability in fuel consumption, despite increasing fuel prices, sets South Africa apart from other countries in terms of fuel usage and spending patterns.
Income plays a significant role in fuel consumption in South Africa. According to Bloomberg, South African motorists spend approximately 5.98% of their daily income on one litre of fuel. This equates to an average of 3.31% of their annual salary spent on petrol. With 11 million vehicles on the roads, fuel consumption constitutes a substantial expense for South African households. In 2015, the average household expenditure on transport was 16.29%, surpassing even the budget allocated for education and health.
The impact of income on fuel consumption is further evident in the sales trends of different vehicle segments. Despite improvements in fuel economy for large cars, the sales share of large and medium cars has decreased, while the market for small SUVs/pick-up trucks and city cars has expanded. This shift suggests that South Africans are opting for more fuel-efficient vehicles to manage their fuel expenses. Additionally, differentiated vehicle registration taxes introduced in 2010 have incentivised improvements in average fuel consumption, with consumers opting for vehicles that offer better fuel efficiency.
While South Africa has relatively low fuel prices compared to other countries, the impact of fuel expenses on household income is significant. The substantial increase in fuel prices since the COVID-19 pandemic has further burdened South African motorists, with drivers spending more on fuel despite travelling fewer kilometres. South Africa's fuel prices are influenced by various factors, including taxes such as the Fuel Levy and the Road Accident Fund (RAF) levy, which account for over 90% of the total levies. The depreciation of the local currency and the surge in international oil prices have also contributed to skyrocketing fuel prices in recent years.
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Frequently asked questions
South Africa consumes 11.1 billion litres of petrol and 12.1 billion litres of diesel a year. The annual fuel consumption from 2017 to 2019 was around 27 billion litres.
According to Bloomberg, South Africans spend 3.31% of their average salary on 202.07 litres of petrol a year. Motorists spend 5.98% of their daily income to afford just one litre of fuel.
South Africa has one of the cheaper fuel prices in the world. However, fuel prices have skyrocketed in the country over the past years due to a depreciating local currency and an uptrend in international oil prices.
The mean fuel consumption across the country is around 7.0l/100km. In 2019, the average fuel consumption of LDVs was 7.4 litres of gasoline equivalent per 100 kilometres, 2.8% above the global average.
