According to the Bureau for Economic Research at the University of Stellenbosch, the oil price is likely to remain volatile in the near term although there had been “some relief” at the end of last week.
“Oil prices and US wheat futures (-8.5%) both ended the week lower, with the one-month Brent crude oil future down by more than 4%. The prices of oil, and commodities in general, remained volatile.
“Early in the week, oil prices surged even higher towards $140 a barrel (bbl) after reports emerged that the US and European allies were discussing a ban on oil imports from Russia,” BER said.
“In the end, while the US announced an immediate ban, the UK said it would phase out Russian oil imports by the end of this year.
“At the same time, the European Union announced plans to, within a year, reduce its reliance on Russian gas imports by two-thirds.”
On Wednesday, the oil price declined sharply by more than 10% after the United Arab Emirates said it would encourage fellow Opec members to raise oil output.
“The oil price is likely to remain volatile in the near term. Given the uncertain outlook for energy prices, there are several scenarios for the domestic inflation outlook,” BER said.
JSE-listed Efficient Group chief economist Dawie Roodt earlier told Freight News that he anticipated a petrol price hike of at least R2 or more, after an analyst suggested the price would surge to R40 a litre.
