The price of fuel in South Africa is unlikely to go up any time soon because of the conflict in Ukraine as price increases for petrol and diesel have already been factored into goods going forward.
However, if Russia’s invasion of its western neighbour drags on, the impact on the futures market could push the oil price higher than this morning’s $102 per barrel, said Dawie Maree, head of Agriculture Information and Marketing at FNB.
In the worst-case scenario expect to pay up R26 per litre of fuel.
Should the scenes of violence and destruction currently playing out across Ukraine end before April, it might not be too late for oil to settle down to the $90 per barrel levels seen prior to the escalation of tension in Eastern Europe, Maree said.
However, he stressed that it would be dependent on the local currency maintaining a healthy exchange rate of at least R15 to the dollar.
As for commodities, Maree warned against a possible steep increase in the price of maize, wheat, soya beans and derivative products.
Over and above the effect that the crisis in Ukraine is having on oil prices, economists yesterday warned that Ukraine was also a major exporter of commodities alongside Russia, accounting for 25% of what’s consumed globally.
