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Big petrol price increases expected

| Economic factors

By: Automobile Association of South Africa

Current unaudited fuel data from the Central Energy Fund (CEF) is showing significant increases for all grades of fuel in February.

Commenting on the data, the Automobile Association (AA) says the numbers are indicating that the short-lived relief South African motorists enjoyed in the past three months is over.

According to the data, 93ULP and 95ULP petrol are expected to climb by between 64ccents a litre and 66c/l respectively, while diesel is expected to increase by around 63c/l. Illuminating paraffin is expected to be 47c/l more expensive in February than it is now.

“The movement in international oil prices is contributing a significant percentage to the increases while the weaker average Rand to US Dollar exchange is adding an impactful but smaller margin to the expected increases,” notes the AA.

Based on these numbers, a litre of 95ULP inland will climb from its current level of R22.49l/ to R23.15/l, while the price of 93ULP inland will increase from R22.17/l to R22.81/l.

“The increases to the prices of petrol will have a negative impact on household budgets at this early part of the year while most consumers are still recovering from festive season spending and stretched budgets. The cumulative effect on personal finances will be a further reduction of disposable income which will be exacerbated by increases to goods and services which must recoup the higher fuel input costs.

“We again urge consumers to monitor their fuel usage carefully, and to budget according to the new fuel prices which come into effect next Wednesday. Ensuring vehicles are well maintained and in good mechanical condition, carefully planning routes, and avoiding heavy traffic, if possible, are some ways in which motorists can ensure better fuel consumption,” the AA concludes.

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