South Africans are bracing themselves for an imminent surge in fuel prices slated for September. The anticipated increase is projected to hit motorists hard, with petrol prices poised to spike by a notable R1.39 per litre, while diesel costs could skyrocket by a staggering R2.60 per litre.
The catalyst behind these impending price adjustments can be attributed to a confluence of unfavourable factors. Notably, the exchange rate between the South African rand and the US dollar has taken a worrisome downturn during the initial weeks of August. Over the span of July 28 to August 14, the average exchange rate shifted from R17.80 per dollar to a less favourable R18.94 per dollar. This shift played a substantial role in tacking on an estimated R1.20 to R1.23 per litre to petrol prices, and an even more substantial R2.41 to R2.42 per litre to diesel costs.
Global oil markets also contribute significantly to the equation. The escalation in international oil prices has been a key driver behind this impending hike. The cost per barrel surged from $84 at July’s end to approximately $86.40 by the middle of August. This uptick translated to an additional 16 cents per litre for petrol, and a weightier 17 to 18 cents per litre for diesel.
According to the CEF, fuel prices in South Africa in September are expected to be adjusted as follows:
- Petrol 93 – Increase of R1.36 a litre
- Petrol 95 – Increase of R1.39 a litre
- Diesel 0.05% – Increase of R2.60 a litre
- Diesel 0.005% – Increase of R2.59 a litre
The CEF emphasises that these forecasts are not the final adjustments that the Department of Energy will implement next month. The upcoming changes could vary, either increasing or decreasing, as they consider possible shifts in the Slate Levy, taxes, transportation expenses, as well as wholesale and retail margins.
Compiled by Warren Hawkins