Petrol price hike announced | Fin24
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Petrol price hike announced

Sep 30 2016 15:47

Cape Town - The Department of Energy announced on Friday that as from Wednesday October 5 the retail price of petrol (93 octane) will increase by 44 cents per litre and that of 95 octane by 43c per litre.

The wholesale price of diesel (0.05% sulphur and 0.005% sulphur) will increase by 23c per litre, while the wholesale price of illuminating paraffin will increase by 22c per litre.

The single maximum national retail price of illuminating paraffin (SMNRP) will increase by 30c per litre and the maximum retail price for LPGAS will go up by 58c per kilogramme.

According to the department, the economic factors which impacted fuel prices in September included an increase in the average international product prices of petrol, diesel and illuminating paraffin.

On average the rand appreciated against the dollar during September, but still remained above the average of August.

The average rand/dollar exchange rate for September was R14.0057 compared to R13.8016 during August. This led to increases in the contribution to the basic fuels price on petrol, diesel and illuminating paraffin by 7.89c/l, 7.48c/l and 7.50c/l respectively.

On Thursday the Automobile Association (AA) said it expected the price of petrol to increase by between 43c and 45c a litre, diesel by 23c and illuminating paraffin by 22c. The AA pointed out that the stronger international petroleum prices have contributed the bulk of the fuel price increase it expected.

"Only around eight cents of this month's increase will come from rand weakness. It is oil strength which has been the major contributor," the AA said.

Neil Roets, CEO of Debt Rescue expects further increases in the fuel price towards the end of the year.

“The ongoing political bickering within the ANC and an extremely sluggish economy is likely to impact on the rand and it looks as if the price of crude oil may also be on the rise,” said Roets.

He added that one of the major effects of the fuel price increase on the economy is going to the continued rise in the price of food. In his view, the real elephant in the room is the expected downgrade by ratings agencies later in the year.

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