Petrol and diesel prices adjusted upwards by 70-75c from Wednesday

The price of petrol and diesel increased by 70-75 cents on Wednesday, following the latest price adjustment by Minister of Mineral Resources and Energy Gwede Mantashe.

The reasons given for the latest price increases are a 6% increase in Brent crude to $82.03 a barrel (from $77.35/barrel) due to the geopolitical tensions in the Red Sea which have forced hundreds of ships carrying oil to re-route around Africa.

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Cold weather has impacted oil production in the US, resulting in higher than expected drawdowns. While not catastrophic for the consumer price index (CPI), these increases will be felt across the economy.

The chart below shows the 10-year trend in 95 unleaded petrol. This is indicative of price increases for other types of fuel. Most alarming is that prices have more than doubled since 2021.

Expanding on the reasons for the increases, Mantashe says higher crude oil prices have impacted the international prices for petrol, diesel and illuminating paraffin, while LPG prices have increased due to higher freight costs.

These factors account for increases of 68.50c, 66.02c and 46.17c per litre in the basic fuel prices of petrol, diesel and illuminating paraffin respectively.

There’s also been a slight deterioration in the rand-US dollar exchange rate from R18.66 to R18.77 over the prior month, and this accounts for 6.86-7.54c per litre of the increases just announced.

Read: Fuel prices expected to ease into 2024 [Dec 2023]

The following are the increases in different fuel types:

• Petrol (93 and 95 unleaded and lead replacement petrol) go up 75 cents per litre;
• Diesel (0.05% sulphur) goes up 73c per litre;
• Diesel (0.005% sulphur) goes up 70c per litre;
• Illuminating paraffin (wholesale) goes up 53c per litre;
• Illuminating paraffin increases 71c per litre; and
• The maximum LPG retail price goes up 37c per kilogram.

Fuel retail prices are adjusted on the first Wednesday of every month.

“The monthly price change which is made is essentially an average over a prior period applied to the future month. This means that South Africa fuel prices lag international prices by one month,” according to the SA Petroleum Industry Association (Sapia).

Source: Department of Mineral Resources and Energy, Sapia