A motorist holds a fuel pump at a Gulf petrol station in London in this April 18, 2006 file photo. Oil dropped nearly 2 percent on March 20, 2012 as Saudi Arabia sought to knock back crude's price rise that has threatened the global economy, with the oil minister offering the most detailed argument to date that the OPEC nation was prepared to meet any supply shortfall. REUTERS/Luke MacGregor/Files (BRITAIN - Tags: BUSINESS ENERGY COMMODITIES)

Johannesburg - Employers and employees in the petroleum sector have signed a two-year wage agreement, the National Petroleum Employers' Association (NPEA) said on Thursday.

The first year of the agreement would see employees receive a 8.5 percent wage increase, and would be effective from July 1, secretary Gerrie Bezuidenhout said in a statement.

“The wage increase for year two, effective July 1 2015, will be the April 2015 CPI plus an improvement factor of 1.5 percent.”

The agreement was concluded following three rounds of negotiations, with the first taking place on May 14, under the auspices of the National Bargaining Council for the Chemical Industry.

Bezuidenhout said the wage deal reflected the good relations that existed between employers and employees in the sector.

“Negotiations were conducted in a spirit of co-operation and no incidents took place during the period of the negotiations,” he said.

The agreement was between the NPEA, representing all the major oil companies, and labour unions CEPPWAWU (Chemical Energy Paper Printing Wood and Allied Workers Union), Solidarity and the SA Chemical Workers Union.