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Tuesday's increase will force road users to fork out R1,26 more per litre than they did in February

By unknown | Apr 26, 2007 | COMMENTS [ 0 ]

Robert Laing

Robert Laing

Petrol will go up 34c a litre on Tuesday at midnight, bringing the price for 93 octane unleaded commonly used in Gauteng to R6,88 and the cost of 95 octane unleaded used at the coast to R6,77.

This 5,2percent petrol price inflation adds to the 69c a litre jump motorists were hit with on the first Wednesday of this month and 24c on the first Wednesday in March. The petrol price has gone up R1,26 or 22,6percent since February.

The minerals and energy department usually announces fuel price changes on the last Friday of each month, but it released the bad news earlier because of the public holiday tomorrow.

The increase would be even worse if the rand had not strengthened against the dollar over the period.

The department said that the retail price of paraffin would now also be fixed by government every month.

Paraffin will go up 24c to R6,26 on Wednesday.

Government allows competition among filling stations for diesel in so far as it fixes the wholesale price. Diesel is going up 30c, bringing the wholesale price to R620,10 a litre. This increased cost of running farmers' tractors and retail chains' trucks will inevitably lead to higher food prices.

Motorists can expect little relief in the coming months even if the international petrol price sinks to $60 a barrel as anticipated.

South Africa's refining capacity has not kept up with booming car sales, so more fuel will have to be imported. Moving imported fuel inland often proves to be a challenge because Petronet's pipeline linking Durban and Gauteng has run out of capacity, and its planned expansion will only be completed in 2010.

Motorists have been warned to expect greater numbers of fuel tankers on the roads, putting more pressure on the road infrastructure.

The oil price in coming weeks hinges on whether or not violence in Nigeria escalates after opposition parties declared that the recent presidential election, which gave the ruling party a landslide victory, was deeply flawed.

Rising violence since early 2006 in Nigeria's unruly southern region where crude is pumped has cut Nigeria's daily production by about one quarter and sent global crude prices higher.

"Nigeria will remain volatile, but as of today the result of the elections have been an increase in export flows rather than a loss of supply," an analyst told Associated Press.


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