The main reasons for the spike are the continued upward march of international petroleum prices and the weakening rand / US dollar exchange rate.
Last month, petrol 95 (both ULP & LRP) went up by 88c/l and 93 (both ULP & LRP) increased by 86c/l.
The wholesale price of illuminating paraffin will increase by 62c/l, while the Single Maximum National Retail price will increase by 83c/l.The maximum retail price or LPGAS will also go up by 98c/kg.
The Automobile Association warned on Friday that motorists should brace themselves for further spikes in the coming months. The combination of firmer oil and weaker rand has exposed the consumer to the full force of oil’s strength, the AA said.
On Monday the rand weaker at R15.76/$ and Brent crude oil was flirting with the $50-mark, selling for $49.74 a barrel. On Thursday, world oil prices breached the $50/barrel mark for the first time in over six months on signs that the surplus are coming to an end.
The AA expressed concern over the steady rise in oil prices in the current weak rand environment, notwithstanding international opinion that global over-supply could see prices pull back.
“With South Africa’s weak economy, our concern is that even if oil prices moderate, further declines in the rand will mask the benefit. It is possible that fuel prices will test new highs in the coming months, placing yet more stress on consumers,” the AA said. – Fin24
Image credit: Rob Deutscher – Flickr/Creative Commons