South African motorists are in for yet another shock at the petrol pumps next week. Rising international oil prices have impacted local motorists greatly in the last few months, and the punches are still rolling in.
On Tuesday, Brent crude oil traded at approximately $76 after peaking at a high $80 earlier in the month. Analysts noted that the price of this oil could rocket up to $100 per barrel.
Speaking on CNBC’s Squawk Box Europe this week, Bob Parker of Quilvest Wealth Management said a shutdown in Venezuelan production could prompt crude oil prices to spike yet again.
“I think that Saudi Arabia, the rest of OPEC and Russia have achieved their objective of clearing this industry overhang from the oil market,” he said.
The rand weakening in May, paired with the rises in oil prices, will translate into South African motorists forking out as much as R16 per litre come June. The latest data from the Central Energy Fund shows that the petrol price is likely to increase by approximately 85 cents, diesel by 85 cents and paraffin by 83 cents.
The Automobile Association (AA) expressed concern over the impact of fuel price hikes on the economy.
“Rises in the fuel price increases the cost of doing business, and companies have few options but to pass these costs on to consumers. Worryingly, people who use illuminating paraffin for lighting, heating and cooking will suffer a further blow as the country heads into winter,” the association said. “The deferred loss from last month will be included in this month’s adjustment, which is currently looking to be substantial.”
Speaking to BusinessTech, CEO of Debt Rescue Neil Roets, said that the expected hike in fuel price will have an unprecedented impact on consumers.
He said that Debt Rescue has taken note of the record number of petitioners approaching the firm for relief of debt by undergoing a debt review are “at the end of their tether”.
“Any further increases in their cost of living is going to result in people going hungry – something which we’ve rarely seen in this country before,” he said.
Below are the prices you can expect to pay for fuel as of June:
95 Petrol – R15.82
93 Petrol – R15.55
0.05% Diesel (wholesale) – R14.20
Picture: Jeff Neale/Unsplash
