Illicit diesel-paraffin blending could affect up to 800 million litres a year
FIASA estimates that diesel adulterated with illuminating paraffin may account for 5% to 7% of South Africa’s market, potentially representing up to 800 million litres a year and billions of rands in lost tax revenue.
Illicitly blending diesel with paraffin could lead to up to 800 million litres of contaminated fuel being sold in South Africa each year, according to industry research. This represents 5-7% of the national diesel market, valued at R15.3 billion, with associated tax losses between R3.6bn and R4.2bn annually. Diesel adulteration is considered one of the biggest illicit trade challenges facing the South African fuels industry.
The higher legitimate diesel prices, expected to rise in October, could make heavily discounted adulterated fuel more appealing to customers, potentially strengthening the illicit trade. The illicit market exploits the tax gap between diesel and illuminating paraffin, with illegal blenders able to discount adulterated diesel by up to R3.02 per litre before breaking even.
Despite this, SARS remains vigilant to fuel-sector non-compliance and has seized more than 953 515 litres of contaminated diesel, with six fuel depots found in contravention of customs law. Road Freight Association CEO Gavin Kelly warned of significant repair costs for hauliers and potential contract penalties. Paraffin reduces diesel's lubricity, causing accelerated wear in high-pressure pumps and injectors.
Motorists and businesses are advised to purchase from reputable suppliers and be cautious of sellers unable to provide verifiable documentation.
Written by urgent.news from IOL's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
