Fuels to cry: SA must expect another petrol price hike
Petrol set for a 40c a litre increase‚ while diesel and paraffin could spike 70c and 65c a litre respectively
South Africans must expect another substantial petrol price increase at the beginning of November‚ the Automobile Association (AA) said.
Commenting on mid-month fuel price data released by the Central Energy Fund‚ the AA said: “International oil prices remain stubbornly high and it is possible that current tensions involving Saudi Arabia‚ one of the world’s biggest oil producers‚ could place more pressure on fuel prices. More welcome news is that the rand is working in SA’s favour‚ and the recent firming of our currency against the dollar has taken some of the bite out of oil’s rally.”
“However‚ the potential price hikes are still daunting‚ especially for diesel users,” the AA said. Petrol prices are set for a 40c a litre increase‚ while diesel and illuminating paraffin could spike 70c and 65c a litre, respectively.
The association said the predicted increase in the price of petrol must‚ for the moment‚ be seen against the department of energy’s proposal to set a maximum price for the sale of 93 octane unleaded petrol and lead-replacement petrol fuels.
“Should this happen‚ it will allow fuel retailers to set their own prices below the maximum amount indicated by government‚ and may‚ depending on the margins‚ ease the burden on users of the two identified fuels,” the AA said.
The AA said SA could not continue to be hammered by large fuel price hikes without severe economic knock-on effects. Earlier in October, the price of unleaded 93 petrol increased by 99c a litre‚ unleaded 95 by R1 and diesel by R1.24.
“The effect on bus and taxi operations could lead to fare hikes that exceed commuters’ ability to pay‚” the AA said.
“We again call on government to prioritise economic policies that inspire investor confidence. A stronger and more stable rand is the country’s only defence against the vagaries of the international oil price.”