Although the state intervened in August to cap September’s fuel price increase and limited it at a mere 5cent increase, the Central Energy Fund has warned that a weaker rand and higher international fuel prices have contributed to an increase of more than a rand for October.
The ever-rising fuel prices have become a political topic, as the state inserted itself and capped the September increase – it was originally predicted to be an increase of between 25 and 28 cents. The government has, however, insisted that the cap was a once-off and will not be repeated.
This intervention is estimated to cost the government nearly R500-million.
Unleaded 95 petrol will now increase by R1.11 – 65c of this is as a result of a weaker rand, while 45c can be attributed to the rising price of oil.
Diesel will increase the most – by R1.37. Illuminating paraffin will now be 1.36 more expensive.
Thus far into September, the rand has slipped by 2.63% against the US dollar.
On Tuesday morning, however, the rand gained traction of almost 1% against the dollar, and analysts have predicted it may strengthen in the short term.