While March marked the start of fall in South Africa, fuel prices are doing anything but fall, as they are set to rise this month after official price adjustments were announced on Monday.
The price increases will take effect from Wednesday, 6 March.
Motorists filling up with petrol will see an increase of R1.21 cents per litre for both grades of fuel, 95 and 93 ULP and LRP.
Meanwhile, Diesel (0.05% sulphur) users will see a R1.06 cents per litre increase and the Diesel (0.005% sulphur) will go up by R1.19 cents per litre.
This means that s a litre of 95 unleaded petrol will cost R23.73 at the coast and R24.45 in the inland regions.
While 93 unleaded petrol will increase to R24.13.
The wholesale price of 50ppm diesel will increase to R21.91 at the coast and R22.62 inland.
The Department of Mineral Resources and Energy said that Illuminating Paraffin (wholesale) will also increase by 64 per litre.
SMNRP for IP goes up by 85 cents per litre, while the Maximum LPGas Retail Price has been set for an increase of 41 cents per KG.
South Africa’s fuel prices are adjusted monthly, informed by international and local factors. International factors include the fact that South Africa imports both crude oil and finished products at a price set at the international level, including importation costs, e.g., shipping costs.
The main reasons for the fuel price adjustments are due to:
Crude oil prices
The average Brent Crude oil price increased from $82.03 to $82.50 during the period under review.
The higher oil price is to be attributed to:
- The continued OPEC+ oil production cuts and the extremely cold weather which affected production from North America, and
- The continued tension in the Red Sea, which added to the geopolitical risk premium on the shipping costs.
2. International petroleum product prices
The average international product prices of petrol, diesel and illuminating paraffin increased in line with the higher crude oil prices.
LPG prices increased due to higher freight cost and weaker rand.
These factors led to higher contributions to the Basic Fuel Prices of petrol, diesel and illuminating paraffin by 102.82 c/l, 102.76 c/l and 47.42 c/l, respectively.
3. Rand/US Dollar exchange rate
The rand depreciated slightly on average, against the US Dollar (from 18.77 to 19.20 rand per USD) during the period under review when compared to the previous one.
This led to higher contributions to the Basic Fuel Prices of petrol, diesel and illuminating paraffin by 17.71 c/l, 18.74 c/l and 18.53 c/l, respectively.
4. Implementation of the Slate Levy
The cumulative slate balance on petrol and Diesel at the end of January 2024 had a positive balance of R239 million.
Therefore, a slate levy of zero c/l will be implemented in the price structure of petrol and diesel with effect from the 6th of March 2024.
BUSINESS REPORT