Mid-month fuel price data released by the Central Energy Fund is pointing to a large increase in prices for petrol and diesel in August.
According to a report by BusinessTech, petrol prices could rise by as much as 87 cents per litre – while the maximum predicted price increase for diesel is 58 cents per litre.
The expected price increases for all fuel types in South Africa are detailed below:
- Petrol 93 – Increase of 83 cents per litre
- Petrol 95 – Increase of 87 cents per litre
- Diesel 0.05% – Increase of 58 cents per litre
- Diesel 0.005% – Increase of 57 cents per litre
- Illuminating Paraffin – Increase of 56 cents per litre
The official fuel price adjustments are still to be finalized, however, meaning the mid-month outlook can change before the official adjustments come into effect on the first Wednesday of August.
The Department of Energy considers two main components when setting the fuel price: the international oil price and the rand/US dollar exchange rate.
At mid-July, a weaker exchange rate for the rand contributed to an under-recovery in prices of around 26 cents per litre.
Meanwhile, international oil prices have also increased – thus adding 32 cents and 59 cents per litre under-recovery to both the prices of petrol and diesel, respectively.
The report further stated that the recent looting and rioting in South Africa is likely to be factored into the month-end fuel price adjustments.
These factors will have to be monitored over the next two weeks to determine the extent of the impact they will have on fuel price and the availability of fuel in August, stated the report.
“While the national tension will bring negative sentiment, it will not be responsible for a dictation of the direction of the rand – it will merely be one of the factors contributing to it, among many others,” said Bianco Botes, Citadel Global director.