South Africans should brace for record fuel price increases in April given continued market volatility emanating from the Ukrainian-Russian conflict.
According to the Automobile Association (AA), data from the Central Energy Fund indicates that fuel prices will reach R24/l for petrol and R23.60 for diesel.
95 octane gasoline should increase by R2.15/l, 93 octane should increase by R2.07/l, diesel between R2.94/l and R3.08 /l and illuminating paraffin of 2.51 R/l.
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The war between Ukraine and Russia has caused significant volatility in the market and further raised supply concerns as Russia is the world’s third largest producer of crude oil. The effects have been evident in the movement of international prices which have reached record highs in recent weeks.
“Based on current data, higher oil prices are contributing 98% of projected price increases, with the rand – which has stabilized around 15.11 rand to the US dollar, contributing the remaining 2%. In fact, however, the value of the rand against the US dollar has a nominal impact on the price of fuel locally,” the AA said in a statement.
AA spokesman Layton Beard told Moneyweb that the Department of Mineral Resources and Energy (DMRE) will make a price adjustment two or three days before the end of the month, which will provide relief to consumers. .
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However, he adds that the dispute is having a ripple effect across the world and consumers will ultimately have to bear the high costs.
“If realized at the end of the month, these will be the largest fuel price increases in South Africa’s history and will no doubt have major ramifications for all consumers and the economy as a whole. general,” the AA noted.
“We should however note that this is the mid-month outlook and that oil prices are currently in a strong swing. So there may still be some relief before the official adjustment by the DMRE not be done in April.
He says he is seeing record fuel prices around the world as high oil prices wreak havoc on all markets.
“Locally, there is little to soften the blow for millions of South Africans who are struggling to cope with a fragile economy that is hurting their personal financial situation. Consumers should brace and prepare for what is likely to be a long winter if the conflict in Ukraine drags on.
Palesa Mofokeng is an intern at Moneyweb.