Rand drops and petrol price increases

THE retail price of petrol will increase by six cents a litre and the wholesale price of diesel will drop by 62 cents a litre from midnight on Tuesday, according to the Department of Energy.

South Africa’s fuel prices are adjusted on a monthly basis, informed by international and local factors.

According to the department, the main reason for the decrease in diesel and paraffin prices is the oversupply of middle distillates such as diesel and illuminating paraffin in the global market.

This is mainly due to the fact that the northern hemisphere experienced a mild winter season compared to previous periods.

China contributed to the situation by exporting diesel into the market. On the other hand, the increase in the petrol price is mainly due to tightness in the market because some major refineries in the US were on unplanned shutdown.

The weakening of the Rand against the US Dollar contributed massively to the current fuel price adjustment.

Based on current local, international factors as well as the margin adjustments, the fuel prices for January 2016 in the South African market will be adjusted as follows:
1. Petrol (93 and 95 octane) will increase by 6c a litre.
2. Diesel (0.05% sulphur) will decrease by 62c a litre.
3. Diesel (0.005% sulphur) will decrease by 63c a litre.
4. Illuminating paraffin (SMNRP) will decrease by 79c a litre.
5. Illuminating paraffin (wholesale) will decrease by 59c a litre.
6. Liquefied petroleum gas (LPG) will increase by 1c a kilogram.