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Levies to inflate fuel price

Mar 31 2010 08:37 James-Brent Styan

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Cape Town - The fuel price will rise between 47c and 60c a litre next week. The exact amount will be announced on Wednesday.

Bheki Khumalo, spokesperson for the department of energy, says half the hike is owing to tax increases and levies introduced by Minister of Finance Pravin Gordhan.

These include a new levy of 7.5c/litre intended to help Transnet finance the new fuel pipeline it is constructing between Durban and the interior.

The Road Accident Fund is also to receive an additional 8c/litre.

The other half of the increase relates to under-recovery on the fuel price last month. Petrol under-recovery was up to 25c/litre and diesel up to 23c/litre.

Econometrix chief economist Tony Twine says the final fuel price increase is more likely to be 55c/litre in the interior and 48c/litre at the coast.

The only difference is the 7c/litre levy that inland consumers will have to pay with regard to fuel piped to the interior through Transnet's existing pipeline, he explains.

Twine says the increases announced by Gordhan include a 10c/litre tax increase.

He also estimates that the under-recovery will be closer to 22.5c/litre.

This under-recovery has been caused by fluctuations in the rand/dollar exchange rate and the oil price.

Twine says while the rand is currently strong at around R7.38/dollar, it was weaker in the first half of March at an average of R7.60/dollar.

- Sake24.com

For business news in Afrikaans, go to Sake24.com.

 
 
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