June petrol price cut to be swallowed by carbon tax
Johannesburg - It has been a turbulent month for both the South African rand and international oil prices but now that the dice that determines June’s fuel price has all but landed, we now have some clarity on next month’s fuel prices.
The cost of petrol is looking set to remain stable in June, according to the Automobile Association, which is predicting a price decrease of around one cent, based on month end data released by the Central Energy Fund, while diesel is likely to go up by around 24 cents a litre.
This means that a litre of 93 Unleaded petrol inland is likely to retail at about R16.47 from next Wednesday, while 95 ULP should retail at R16.66 inland and R16.02 at the coast.
Under normal circumstances petrol would have actually gone down by about 10 cents a litre and the diesel hike would have been limited to 14 cents, but the government’s new Carbon Tax, announced during the Budget Speech in February, is due to kick in from the beginning of June, adding nine cents a litre to the cost of petrol and 10 c/l in the case of diesel.
Not surprisingly this new carbon tax has been widely criticised as just another tax collection method with no proven benefit for the planet.
“Introducing a carbon fuel levy without a clear indication that this will be ring-fenced for climate change mitigation initiatives, and with no clear link to behavioural change, appears to be disingenuous,” said Heinrich Volmink, executive head of The Organisation Undoing Tax Abuse (OUTA).
At this stage it remains very unclear how the fuel price situation will unfold in the coming months as any number of current issues could impact oil prices in the second half of 2019, the AA warns, with further economic storms looking very possible.