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Fuel price likely to rise by over 40 cents

Industry news

Last month's fuel price reductions will be short-lived after all, with the latest figures from the Department of Energy showing that a price hike is inevitable.

So far the month of September, up to the 27th, has seen an average petrol price under-recovery of 43 cents a litre and with just two days left to be factored into the equation, a price increase of between 40 and 45 cents is looking likely. The diesel price deficit currently stands at 23 cents so anything in the 20-25 cent range can be expected.

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File picture: Newspress.

A litre of 95 currently costs R11.69 at the coast and R12.17 in Gauteng and, while 0.005 diesel retails at R10.10 - R10.49.

On the bright side, the inflationary pressures do appear to be easing.

Around the middle of the month the average under-recovery had been running at 51 cents a litre and rising, thanks to the daily figure hovering around the 70 cent mark in the preceding days. Thankfully, the deficit has been shrinking since then (it was only 21 cents on September 27), helping to erode the average for the month to 43 cents.

This is largely due to the rand having bounced back in the latter half of the month, trading at R13.50 to the US dollar at the time of writing, from a September low of R14.66. Oil prices have also been behaving, for the most part, with Brent Crude currently trading at $46.25 a barrel.

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