Fuel industry allays fears of shortages

There’s no end in sight to the national strike in the petroleum sector - but oil firms maintain they have contingency plans in place.

Johannesburg - There is no end in sight to the Chemical, Energy, Paper, Printing, Wood and Allied Workers Union’s (Ceppwawu’s) national strike in the petroleum sector that could lead to fuel shortages if it takes longer.

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Following a deadlock in the annual wage negotiations with the National Petroleum Employers Association (NPEA), workers aligned to Ceppwawu on Thursday went on strike. The union is demanding an increase of 9 percent, while the industry was offering a 6.5 percent increase.

The union also wants a one-year wage deal and not the two-year deal proposed by NPEA.

In a statement on Friday, NPEA said its members had taken measures to ensure that there was minimal disruption in the supply of fuel and related products. “So far these have been effective,” said NPEA. The strike has, however, heightened fears of fuel shortages as it affects refineries and fuel depots. A prolonged strike could affect delivery of fuel to service stations.

Contingency plans

The various oil companies, which own refineries, depots and fuel stations across the country, were this week quick to allay fears of shortages, saying they had contingency plans in place.

NPEA deputy chairman Zimisele Majamane on Friday said the employers were proposing a two-year agreement, in order to provide stability for the companies in the sector to focus on long- and short-term industry-related matters. He said wage negotiations brought uncertainty. “(Oil companies) do not know what will happen (in the negotiations). Even the deal that ended in June was a two-year deal,” said Majamane.

NPEA said its proposal included a 7 percent increase in the first year and an increase equal to next April’s consumer price index plus 1.5 percent in year two. “Employers believe that the above proposed increases are fair and reasonable when taking into account the country’s slow economic growth, the high currency exchange rate and the drastic decline in the crude oil price towards the end of 2015.

“This was evident in the cost containment measures such as salary freezes, a moratorium on recruitment, reductions on short-term employment and retrenchments, implemented by some of the petroleum companies. Solidarity and SA Chemical Workers Union, who were also part of the negotiations, have indicated their willingness to accept the employers’ proposal.

“Employers remain committed to resolving the current deadlock Ceppwawu and are available to progress the negotiations,” NPEA said.

Ceppwawu spokesman Clement Chitja said on Friday the union had sought a meeting with the employers to discuss the wage demand. He said the union would continue with the strike “until a good and acceptable offer is made”.

Majamane was, however, not aware of the meeting sought by Ceppwawu. “There has been no request for a meeting. But as employers we are available to meet,” he said.

Meanwhile, the Department of Energy said the fuel price would decrease by 99 cents a litre for petrol and by 74c a litre for diesel next week.

The department has attributed the drop to a dip in the international product prices of petrol, as well as the stronger rand to the dollar.

SUNDAY INDEPENDENT