Whilst it is unlikely the petrol price will hit the R20 mark by the end of the year, more hikes are definitely on the cards before then. This is according to economist Mike Schussler who said more fuel increases this year were almost a given.
This comes after hikes in early October that saw the price of fuel reach record highs. Inland 93 unleaded petrol now retails for R16.85 per litre, 95 unleaded at R17.08, diesel 50ppm at R15.69 per litre and diesel 500ppm at R15.64. At the coast you will pay R16.34 per litre for 93 unleaded, R16.49 for 95 unleaded and for diesel 50ppm R15.21 per litre and R15.16 for diesel 500ppm.
According to the Automobile Association (AA), based on the unaudited mid-month fuel price data released by the Central Energy Fund, South Africans could expect the next fuel increase before the end of this month. This in light of comments by minister of energy, Jeff Radebe, that the main reasons for the fuel price adjustments in early October were the rand depreciation against the US dollar, the increase in the price of Brent crude oil and the increased prices of imported petroleum products.
As international oil prices remained stubbornly high, and uncertainty over the impact of current tensions involving Saudi Arabia prevailed, pressure on fuel prices was a given.
“The potential price hikes are daunting, especially for diesel users. Petrol prices are currently set for a 40 centsa-litre increase, while diesel and illuminating paraffin could spike by 70 cents and 65 cents respectively before the end of this month,” said AA spokesman Layton Beard.
With the department of energy currently in discussion with the petroleum industry to discuss the possibility of capping the price of 93 octane, this 40-cents hike was not however a given. By capping the price, fuel retailers will be allowed to set their own prices below the maximum amount indicated by the government.
Details of this proposal and the possible implementation, however, remain unclear. Schussler said finding a solution to the increasing fuel price was imperative as the economic knock-on effects of the increases would be severe.
