Brace for another petrol price hike
The petrol price‚ already at a record high‚ is set to go up again this week.
Minister of Energy Jeff Radebe has announced that the price of 93 octane will increase by 26 cents per litre and 95 octane by 23c/l on Wednesday.
One of the main reasons for the hike was a depreciation of the rand against the US dollar during the review period – from R12.51 to R13.29 – which led to a higher contribution to the basic fuel price (BFP) on petrol‚ diesel and illuminating paraffin by 43.21 c/l‚ 44.36 c/l and 44.62 c/l respectively.
“The rand’s movements were mainly influenced by global factors. The market has started to become worried about the effect that the trade war between the USA and China will have on the global economy‚” Radebe said.
The effect of the rand’s depreciation‚ however‚ was cushioned by a decrease in the prices of crude oil as well as in import prices of petroleum products.
“The average Brent Crude oil price decreased from US$77 to $74 per barrel during the period under review. The main reason for the lower crude oil prices is that the Organisation of Petroleum Exporting Countries (OPEC) and its allies agreed to increase production in order to retake market share from rivals and to calm prices to avoid blunting demand growth during their meeting on June 22 2018. The lower crude oil prices cushioned the consumers from higher fuel price by close to 20 cents per litre‚” the minister said.
The price of diesel will increase by 24c/l while the wholesale price of illuminating Paraffin will rise by 22c/l on Wednesday.
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