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Fuel price hikes: how you can save

Mar 15, 2022

With recent fuel price hikes delivering a shock to all of our budgets, every little bit of savings counts.

Fuel price hikes: how you can saveIt now costs motorists over R1 000 to fill up a 50-litre tank of fuel. At a pump price of R21.60 per litre, for a reasonably fuel-efficient car that consumes 6 litres per 100km, that works out to R1.30 per kilometre.

In the last two years, the fuel price has increased 36% or R5.76 per litre, and there’s more pain to come. Not only are we likely to see further fuel price hikes, but we will also need to absorb a 9.6% increase in the price of electricity in April.

While we can breathe a sigh of relief that the National Energy Regulator of South Africa (Nersa) did not approve the full 20% increase that Eskom requested, this follows a 15% price hike in 2021.

We will be paying 21% more for electricity than we did two years ago. As FNB Economist Koketso Mano points out, these increases are far higher than any salary increases individuals have received or can expect receive.

Fuel price hikes outstrip inflation

With the economic consequences of lockdown, many employers – including the government – did not pay salary increases in 2020. Going forward, Mano says most employers will base salary increases on the official inflation figure of 4.5%. She also points out that all grant increases in the 2022 Budget Review were in line with the official inflation figure.

“This is particularly challenging for lower-income earners who spend a higher proportion of their income on basic services. They face an official inflation rate of between 6% and 7%.”

If salaries are only increasing by 4.5%, but our electricity and fuel increases are nearly triple that figure, a greater portion of our monthly budgets will be going to transport costs and electricity.

At the same time, interest rates are expected to continue to increase. This simply means budgets will be re-aligned and less will be available to spend on other needs.

As these are essential items, we have no choice but to find ways to absorb these costs. The only way we can soften the blow is to take serious steps to lower our consumption of electricity and fuel and to max out those reward programmes.

Double up on fuel reward programmes

Most banks offer fuel rewards as part of their reward programmes, but so do certain retailers. If you combine the bank and retailer programmes you could somewhat soften the blow of the latest price hikes. Retailer programmes like Dis-Chem, Clicks, and PicknPay have the bonus that they are free to join, so earning 10c to 15c back for every litre of fuel is a no-brainer.

FNB customers could combine their eBucks earn rate with the Clicks ClubCard when filling up at Engen. Clicks ClubCard earns you 1 point for every litre of fuel at Engen, equivalent to 10c per litre.

The eBucks earn rate ranges from a minimum of 10c up to R8 per litre, though this top rate requires meeting several criteria including having car finance with Wesbank.

Discovery Bank and Nedbank both offer fuel rewards at BP. With Discovery Bank, you can earn up to 15% back on your fuel spend, while Nedbank offers a flat rate of 25c per litre. This is on top of the 10c per litre you get with the PicknPay Smart Shopper Card.

Absa Rewards is linked to Sasol, with cashback ranging from 8c to R4.70 per litre. This could be combined with Dischem’s 10c per litre reward.

Some banks or insurance companies charge a fee for their reward programme, so if you have to pay to join a reward programme, make sure it is worth it, based on your overall spending pattern. If you join just for the fuel benefits, it may not be worth the monthly fee.

Capitec has partnered with Shell’s V+ programme, and its reward of 20c per litre is available to all customers with no additional reward programme fee.

Standard Bank UCount has a sign-up cost of R25, and has aligned with Caltex and Astron and UCount

Discovery Insure offers car insurance policyholders discounts based on tiers and behaviour tracking. If you are prepared to work the programme it offers a fuel reward ranging from 78c to R7.83 per litre at both BP and Shell.

This article first appeared in City Press.

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Maya Fisher-French author of Money Questions Answered

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