More painful petrol, diesel price hikes ahead

All hope of a fuel price cut in October is likely lost, according to the latest data from the Central Energy Fund (CEF).

A strong rand rally at the start of September initially put the petrol price on track for a cut in the first week of October.

But then an attack on a major oil facility in Saudi Arabia triggered a record one-day oil price surge.

“The refinery strike was a game-changer for the way oil price stability is viewed. At a single stroke, five to seven percent of the world’s oil output was wiped from the board, leading oil prices to surge disproportionately,” the Automobile Association said in a statement last week.

After an initial spike of 20% to above $70 a barrel, the oil price has since retreated, with Brent crude oil currently trading at $63 – compared to $60 before the attack. Saudi output was restored this week to pre-attack levels.

But, meanwhile, the rand has taken a hit amid concerns about a global trade war. On Wednesday, it broke through the R15/$ level for the first time in three weeks. It was last trading at R15.03.

Based on the latest CEF calculations, the recent rand and oil price movements will leave unleaded 95 octane petrol on track for an increase of 19c a litre, while 93 octane petrol could be cut by around 4c. Diesel prices will increase by 24c, and paraffin by the same margin.

Petrol prices have increased by almost 15% this year, from R14.01 for 95 unleaded in January, to R16.03 in September.

For more news your way, download The Citizen’s app for iOS and Android.