As the price of crude oil increases internationally and the rand weakens further, South Africa will see a sharp increase in its fuel prices across the country from Wednesday this week.
The price of 93 and 95 Unleaded petrol will climb by R1.21 a litre, while the price of diesel will rise by 148.2c a litre. The wholesale price of illuminating paraffin will also be hiked by R1.45 a litre, according to the department of mineral resources and energy (DMRE) via a statement seen by Media24.
Currently, the globe is seeing higher than average increases in the price of Brent oil, which went from $75.50 in September to $83.40 per barrel last month – its highest price in the last three years. SA’s local fuel prices are determined by international oil prices, as well as the dollar-rand value, as the country must buy oil in dollars.
“The key driver (of higher oil) is the higher global demand recovery, amid a weaker supply response from non-OPEC and other oil producers,” the DMRE said.
“The situation was exacerbated by the impact of the current gas challenges experienced by European countries.”
In some parts of Europe, the price of gas has more than quadrupled in 2021, with suppliers struggling to keep up with increased demand for fuel as millions across the globe begin exiting COVID-19 lockdown restrictions with vaccines becoming more ubiquitous.
The weakened rand also hasn’t aided the situation. The currency dropped from R14.56 to the dollar in September to R14.72 to the dollar in October. Together with the increases in the so-called Slate Levy, from 13.16c per litre to 15.36c per litre, which is paid to petrol companies to compensate for imbalances that emerge over time because of the way that the basic fuel prices are calculated, South Africa’s already record-high fuel prices are set to get even higher.