Motorists, get ready... highest fuel price spike since Dec 2022 forecasted
According to latest data by the Automobile Association of South Africa (AA) all grades of fuel are predicted to increase on Wednesday, 6 September pending the Department of Mineral Resources and Energy (DMRE) approval thereof which is set to be heard on Monday, 4 September.
Petrol is currently facing increases of between R1.41/litre (for ULP93) and R1.45/l (for ULP95), while diesel could climb by as much as R2.60/l and paraffin could see increases by R2.55/l.
If the fuel hike is realised, these increases will mark the highest prices since December last year.
For ULP95 users in Gauteng, the increases will result in a price point of around R24.28/l for fuel, and it will cost about R1335 to fill a 55-litre car. Filling the same car at the coast will cost around R1311.
While AA notes that this price hike prediction is based on mid-month data - the prices may vary before the official adjustments, but the current outlook is certainly pointing to significant increases at that time.
The AA warns that the surge in fuel prices will pile pressure on all diesel users, but particularly large users in the agricultural, retail, manufacturing, and retail sectors.
Consumers should also brace for increases at the till as costs are recovered through higher prices, advises the AA.
Fuel prices in South Africa are driven by two main factors:
1) International oil prices.
2) Exchange rate between the Rand and the US dollar, as crude oil is traded in US dollars. A weaker Rand means fuel gets more expensive to buy.
Oil prices have risen in recent weeks because, among other reasons, some producers curb output because of weak demand.
"It’s difficult to avoid paying the higher prices," says AA. Of course, this possible rise will have a domino effect on South African motorists.
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