Another big fuel price hike expected

2011-02-04 09:02

Cape Town - With a rising oil price and weakening rand South African motorists and the road transport industry must steel themselves for a sharp hike in the fuel price next month.

This will follow close on the heels of Wednesday’s hikes of 26c/litre for petrol and 30c/litre for diesel.

Over the past week the rand weakened from R7 to R7.24/dollar and the price of Brent crude rose to $102/barrel. At one point on Thursday the rand dipped to R7.27/dollar.

Even after the latest price adjustment took effect on Wednesday, on the day there was still an underrecovery of 26c/litre for petrol and 46c/litre for diesel, according to information from the department of energy.

The average underrecovery between Friday January 28 and Wednesday was 40c/litre for petrol en 60c/litre for diesel. This meant motorists were paying 40c/litre too little for imported fuel.

Econometrix economist Tony Twine said that if the rand/dollar exchange rate and international fuel prices remained constant until February 24, the March petrol price could be bumped up another30c/litre, and diesel 50c/litre.

Together with the annual increase in the fuel tax and the Road Accident Fund levy – which normally takes effect in April – and what Finance Minister Pravin Gordhan announces in his budget speech on February 23, the April price of petrol in South Africa could reach R9.50/litre and diesel R9/litre, Twine has estimated.

He said that for much of January oil prices were at $98 a barrel because of the cold winter in Europe and north-east America, as well as the Australian floods which ruled coal out as an alternative energy source for many importing countries.

With last week’s announcement by the United Arab Emirates that, as a member of the Organisation of Petroleum Exporting Countries, it would increase its oil production, the oil price dropped to $94 a barrel overnight.

But then last Friday the Egyptian unrest broke out and at the beginning of the week oil prices had returned to $98/barrel, Twine explained.

- Sake24

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  • Solo - 2011-02-04 09:26

    More like R10.30 in April, those figures seem to cheap!

  • Customer - 2011-02-04 09:29

    It's purely a loot, during november,december last year ZAR was quite strong, but nobody made a point that they reduce the fuel prices, all that money earned dur to strong ZAR has gone in politician's pockets & now they want to earn more disgasting

  • Lily White - 2011-02-04 09:30

    Let me get this right. The rand was too strong a few weeks back, which 'was not good for the economy'. So it was weakened. To the point where we have to have big fuel hikes every month? Is anyone in control or are we going along and hoping for the best?

  • Jan Hofmeyr - 2011-02-04 09:48

    Pleees man. I don't need an economist to tell me i'm paying too little for petrol when I know I am paying too much. funny how when these economic indicators are in our favour the price never drops but they will always find reasonds to increase the price...Cold weather, Egyptian unrest, World cup!!.

  • Phillip - 2011-02-04 09:49

    I can't understand the logics in this, when the oil price goes up, the fuel price goes up, that's normal, but the ratio's are not. For example, now we might pay up to R10 per liter petrol, and the oil is at $100..40 or 50 cents increase, but when the oil price drops down to $75 again, the government will reduce the fuel price with 5/8 cents. 5 Years ago, when the oil price was around $75, we paid in the vicinity of R6/ liter, when it came down last year to about the same price, we paid around R7/liter..... It looks to me it is more a ripp off than anything else!!!!!!!

  • Insider - 2011-02-04 09:50

    And ~80% of Gautengs fuel come from SASOL HAHAHAHHA. This (price determination) is due to an historic agreement, and Gov't (+SASOL) is obviously smiling! (WHILE WE HAVE TO PAY!!!)

  • Ray - 2011-02-04 09:51

    Everybody is worried about the fuel price, which in effect is out of our control, however, the new toll fees are going to cost me approx R2000 per month to get to work and the heavy vehicles approx R3.75 a kilometer which will increase the tranport costs. The cosumer will bear these costs. We pay licence fees for this and there is a fuel levy for roads. We are the highest taxed in the world and the goverment now makes us pay to get to work.where is the poor man in the street going to get hit next. Sasol is made from coal which the tax payer paid for. Why does this increase with the fuel price.??????????????

  • Jay Jay - 2011-02-04 09:55

    Who can we blame for this other than teh present ANC goverment and the Reserve Bank for wanting the Rand to weaken.With the oil price rising the way it is we now needed a strong Rand at under R6.00 to the dollar. The weak rand is going to push up the cost of all imports and next is inflation at above 6% and interest rate hikes

  • Darryl - 2011-02-04 09:59

    I quote from the articale: The average underrecovery between Friday January 28 and Wednesday was 40c/litre for petrol en 60c/litre for diesel. This meant motorists were paying 40c/litre too little for imported fuel. Imported being the key word. Why is SASOL then pushing their prices up??? Fatcats I tell you!

  • George - 2011-02-04 10:00

    I would just like to know how these prices are worked out??? When the rand was weaker and the oil price was around $147 a barrel...we were looking at similar fuel prices. Now all of sudden we are looking at the same prices with the oil price around the $100 per barrel mark and the rand a lot stronger!?!?!!? Smacks of some more government corruption if u ask me!!!

  • Sylar - 2011-02-04 10:13

    I dont get it, when the rand was so strong to the dollar the petrol price never went down, now that it is weak against the dollar, the petrol price rises so high...

  • Sanegran - 2011-02-04 10:17

    This is madness,rising food prices every year.Increase based on inflation.People earning and average to below average wage will very soon dip into poverty.Every year one has to downgrade lifestyle. How long can u downgrade

  • Peter - 2011-02-04 10:20

    And now you will see what happens when all the folks who wanted a weaker rand have to pay more for imports...let's see what they say now.

  • Mr Van Rensburg - 2011-02-04 10:25

    If the government stop overtaxing the price of fuel, the need for such hikes will be less painful to the consumer.

  • Flinger - 2011-02-04 10:30

    Why not pre-empt? The price was stable for a long time, why not introduce 4c here and 7 cents there to counter act the inevitable, then the shock to the consumer pocket wont be so bad...

  • Gatvol - 2011-02-04 10:34

    Again they will be milking the tax base. Food and everything else will increase dramatically. I will start using my bicycle to work. One of these days they will have a shitload of fuel, but no one will be able to afford to buy it.

  • Joe - 2011-02-04 10:34

    Now Mr Gordhan and the economists must explain to us plebs how a weak rand benifits the man in the street! As as I can see it means less money to save!

  • BOBO - 2011-02-04 10:39

    OMG. The government must reduce levies on the petrol price. They are killing us.

  • aelric - 2011-02-04 11:16

    The Road Accident Fund should be gotten rid off.. it is a joke, den of liars and thieves.. mismanaged and corrupt.

  • Why are we paying - 2011-02-04 11:43

    The Reserve Bank is artificially weakening the Rand by buying foreign currency reserves, because the ANC thinks this will help the economy. But the weak currency is what's causing these fuel price increases. Why are we paying for an artificial weakening of the currency? How is a fuel price of R9.30/litre going to help the economy? Someone in government catch a wake up!

  • Nick - 2011-02-04 11:55

    For those of you wanting to stay informed and not make rash comments, the petrol price is determined by a transparent procedure available on the Central Energy Fund's website: Before I get assassinated, I am not defending the ridiculous levies and taxes that are included in the price we pay as consumers.

  • Nick - 2011-02-04 12:02

    For those of you wanting to stay informed and not make rash comments, the petrol price is determined by a transparent procedure available on the Central Energy Fund's website: Before I get assassinated, I am not defending the ridiculous levies and taxes that are included in the price we pay as consumers.

  • Crippled Motorist - 2011-02-04 12:11

    What new government blunder are they getting us to pay for? Do we have to fund the local government elections, or an ANC member's lavish lifestyle? Or municipal account bungling? It appears to be nationwide. Get rid of RAF, fuel levies, taxes, paying for Transnet's pipelines, incompetent staff salaries, etc. The ruling party is totally and utterly inept in all respects.

  • logical007 - 2011-02-04 13:23

    The petrol price in South Africa is comparitive to the rest of the world. In the Uk petrol price is 1.30Pounds per Litre. Also if you take the work required to refine oil and to make petrol, you would probably understand the price better, considering I'm sure all of you complaining about this increase are happy to spend R11.00 on 1 litres of Cold-drink

  • Willem - 2011-02-04 13:51

    Anything govt touches smells of corruption and abuse. Maybe we should as consumers of exorbent fuel prices demonstrate as the Egyptians for an afordable price fix of 12 months on all consumer items.

  • Johnathan - 2011-02-04 14:06

    I have given up trying to explain fuel prices. People simply don't WANT TO understand. They also don't seem to have much mathematical ability - perhaps not surprising when one looks at the matric maths results of the past few years...

  • Badger - 2011-02-04 14:41

    "....This meant motorists were paying 40c/litre too little for imported fuel...". I only use Sasol Diesel which is local, does this make any difference ???? ANYONE ??

  • ZANW - 2011-02-04 15:22

    anyway u look at the situation the price increase is going to be a shocker, time to buy a scooter

  • Rurap - 2011-02-04 15:41

    Yay! We'll now be sponsoring the new Joburg Billing system! R1m for the billing system, R5m for the new Range Rovers, Houses and holidays for the govt officials involved in it.

  • Tnerb - 2011-02-04 15:57

    What is a triangle doing on the Richard Branson video?

  • realist - 2011-02-04 16:01

    Blame the uncaring ANC for this. They skim off 70% of the price for "taxes" to finance their propaganda and back pockets. I add and burn water in my Carb and better by consumption by almost 20%.

  • Skold - 2011-02-04 16:40

    whats so wrong with having a strong R anyways, does the world diagree to this, are they the only ones allowed to have a strong currency? will make life easier for us all, and for those who like to travel or want to they can atleast spend less for more. yes blame the ANC, for EVERYTHING, high taxes, potholes you can take your family to swim in, reversed appartheid with BEEE and AA, petrol prices... the whole lot. i hope that "change" comes soon, we need a goverment that doesnt exist out of crimanls and corrupt officials.

  • Investor - 2011-02-04 18:58

    To all those lunatics calling for a weaker currency FEEL THE PAIN !!! INFLATION COMING, INTEREST RATE HIKES FOOD RIOTS !!!

  • mark - 2011-02-04 19:41

    Does anyone not think it strange that the taxi industry is not complaining about the rescent increase in fuel, is evident that they are being subsidised by government, at the expense of us the tax payers, lets vote with our brains and get this governemt out for good. it is the only way to save SA.

  • Collitjies - 2011-02-04 21:13

    Why do the SABC continue to quote "Brent Crude" prices. I believe that comes from north sea oil wells. Since when does RSA buy from the north sea suppliers. Does it make it easier for them to steal our hard earned cash yet again.

  • Lily White - 2011-02-05 01:33

    @Logical - Think before you blurt out rubbish. We dont need buy 40l of cool drink every week.

  • Andrew - 2011-02-14 22:46

    Why do they increase the tax to petrol and diesel everything is going to Icrease and the consumer has to pay and pay Why don't lower the tax so that consumer can breath We just pay and pay Waht about the big cars they drive that is Government expenditure Where do they get there Petrol and diesel I suppose they get a subsidy

  • Cloota - 2011-02-15 07:58

    another reason why we should move to an open fuel standard, so we can have a choice at the petrol pumps between the cheapest fuel.

  • Freddy - 2011-02-15 20:02

    The economy is going to crash. Brace for it & good luck.

  • Collitjies - 2011-02-15 21:28

    Their lastest scam is to steal even more by screwing motorists who have to use cluttered toll roads to earn a living. The ANC should STOP giving taxis cheaper petrol and let everyone pay the same.

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