Johannesburg – The department of minerals and energy is likely to implement a retail petrol price increase of about 24 cents per litre (c/l) on February 6‚ provided the daily under-recovery remains near the January 17 level.
The wholesale diesel (0.05% sulphur) price could jump by about 26c/l.
SA’s daily unleaded 95 Octane petrol price under-recovery was 30.8c/l on January 17‚ while the diesel under-recovery was 33.6c/l.
An under-recovery means that the basic petrol price based on the daily product price and exchange rate is more than the basic fuel price used in the calculation of the monthly retail petrol price.
An under-recovery therefore implies that the retail petrol price will most probably be increased at the next monthly price adjustment‚ provided the government does not introduce a new levy or raise either the wholesale or retail margin.
The retail petrol price is adjusted monthly on the first Wednesday of the month in accordance with the previous averaging period's over- or under-recovery.
The current averaging period runs from December 27 to January 31 and a price announcement is due on February 1. The average under-recovery for the period December 27 to January 17 for petrol was 19.1c/l and the average under-recovery for diesel was 21.7c/l.
Follow Fin24 on Twitter, Facebook, Google+ and Pinterest.