Oil prices and who to blame
By Mluleki Dlelanga
Against a background of the hike in fuel prices in our country, this came into effect just the last two days. There is a loud alarming views and general concern by the working class and even some economists blaming either the President of the Republic of South Africa or the Organization of Petroleum Exporting Countries (OPEC). This blame game is a result of the recent fuel prices hike, the fifth time oil price increase in our country in 2018 and which is now at its highest level ever.
The general public, of course out of frustrations instead of understanding the current economic situation and capitalist system opportunistically put blame on the doors of the President of the Republic of South Africa. On the other hand the economists put blame on the doors of the Petroleum Exporting Countries (OPEC) that they operate like a cartel by colluding on setting world oil prices. Immediately the economists accused OPEC, the South African Petroleum Industry Association (Sapia) has come out in defence of OPEC.
Capitalists, liberals and their cronies always claim that we must understand that oil prices are determined by market forces - demand and supply of oil in the international oil market. It is also important to understand that markets, by themselves, even when they are stable, often lead to high levels of inequality, outcomes that are widely very unfair to the working class. With that understanding it is important to note and understand who benefit with high oil prices and who suffers with high oil prices especially in South Africa.
Global oil prices
There are according to the executive director of Sapia, Mr Avhapfani Tshifularo that “Petrol prices in South Africa were not the most expensive in the world”. It is crystal clear that the above listed cheapest oil countries are mainly oil-producing nations, with prices ranging from 11cents per litre of petrol to R5.50. The likes of Venezuela(R0.11), Iran (R 3.57), Sudan ( R4. 29), Kuwait( R 4.37), Algeria(R4.53), Egypt( R4.64), Ecuador( R4.92), Nigeria( R5.27), Turkmenistan(R5.39) and Syria ( R5.50). These Nations receive oil revenue form their wells and possibly also subsidise their petrol prices, whereas South Africa is not an oil-producing nation and does not subsidise the petrol price. A significant portion of petrol prices is taxes that are levied off petroleum products and most oil-producing nations have lower or no taxes at all because they can receive oil revenue from crude oil sales.
The following are the most expensive countries per litre of petrol i.e. Iceland (R27), Hong Kong (R26.67), Norway (R25.72), Holland(R 24.83), Greece (R24.31), Monaco (R24.15), Italy (R24.14), Israel (R24.03), Denmark (R24.02) and Portugal (R23.50).
In all these countries surely the people who burn the brunt of these high petrol prices are the working than the bourgeoisie. Bourgeoisie are the beneficiaries and the working class suffer the most.
A strong allegation, which I partly share some sentiments of it is that OPEC operates like a cartel. It manipulates supply and demand of oil throughout the world. I also think that there are risks to the supply of oil-which OPEC will undoubtedly be aware, of which could push oil prices upwards. These includes geopolitical risks in Iran and Venezuela, both are OPEC members. With regard to Iran, there is a fear that Iranian oil supplies could be interrupted in the event US withdrawing from the Iranian oil agreement.
Fuel hikes and its impact to the working class
The over-indebtedness of the working class in our country is a serious concern that has an impact on the improving the living conditions of our people as well as the success of our revolution. The main current political programme is the full realisation of the National Democratic Revolution which its content historically understood that” the national liberation of the African people in particular and blacks people in general , the destruction of the economic and political power of the racist ruling class and the establishment of one united states of people's power in which the working class will be the dominant force and which will move uninterruptedly towards social emancipation and the total abolition of exploitation of man by man”.
In military terms, there is no general who has won the war with hungry and frustrated soldiers. In our country, people continue to be ravaged by poverty, unemployment, inequality and corruption. In equality in our country didn't just happen, it was created. As such the gap between the rich and the poor continue to widen. These fuel hikes will have a huge negative impact on the average people who earn an average salary in various ways. These fuel hikes are not budgeted for as the average person has already budgeted for his or her living expenses such as rent, bond, grocery, transport to work and daily expenses. Ultimately, these fuel hikes leads to over-indebtedness of the working class as they can't afford daily or living expenses. This further leave working class to subject themselves to loan shacks and more loans. This in terms of interest rates hugely affects the working class badly. It is important to note that the same working class is receiving sms that they won a loan as such under these conditions easily get tempted to approach the institution that lure them in such cruel practice.
Basically, the working class is unable to contend with exorbitant fuel hikes as they are unbudgeted expenses and this further affect the working class to be unable to afford their families. Over excessive economic costs leads to working class more indebtedness. The negative indirect cost leads to working class unable to pay bonds, dstv, accounts, grocery, loans and leisure costs. Even if the working class try as much as possible to rein its horses in, this has a negative impact on their production at work and in the community.
It is becoming clear that the working class feel these fuels hikes and can no longer afford further fuel hikes .A generally outcry on social networks and the number of cars that visited filling stations across the country hours before the fuel hikes is a living testimony to unaffordability and the conditions of the working class in our country.
There are moments in history when people all over the world seem to rise up, to say that something is wrong, and to ask for a change. This is what happened in the tumultuous years of 1848 and 1968.Each of these years of upheaval marked the beginning of the new era.
Our struggle for socialism is more relevant as people continue to suffer unbudgeted fuel hikes and they share same understanding to their challenges and I hope soon they will understand that capitalism is a cruel system against humanity and as such it will continue to be characterised by such hikes and realize that there is a need for a new political system that will end their sufferings and such system is socialism.
Instead of blaming individuals, let's blame the system but let's not only blame it but let's all as the class unify to crush this system of capitalism. That's the bottom line, coz YCLSA, Says So!
Socialism in our lifetime!
Cde Mluleki Dlelanga is the National Secretary of the YCLSA.