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No drop in price of petrol

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The international prices of petrol decreased slightly and diesel increased on average during the period under review

File picture: Karen Sandison/African News Agency (ANA).

NORTHERN Cape residents hoping for a drop in the price of petrol will be left disappointed after the Department of Energy announced yesterday that the price of petrol would remain unchanged in November, while diesel would increase by 48 cents (500ppm) and 51 cents (50ppm) from midnight tonight.

Petrol users were hoping for some relief this month after the Automobile Association (AA) earlier this month said that the petrol price was expected to drop by about 16 cents a litre, following the unaudited month-end fuel price data released by the Central Energy Fund.

“We expect the petrol price to drop by about 16 cents a litre, and, unfortunately, diesel and illuminating paraffin will both increase by about 30 cents a litre,” a statement issued by the AA earlier this month read.

However, the Department of Energy yesterday announced that the price of petrol would remain unchanged in November, while diesel would increase by 48 cents (500ppm) and 51 cents (50ppm), on Wednesday, November 7. The wholesale price of illuminating paraffin will rise by 28 cents.

Thus motorists will still pay R16.85 a litre for 93 octane unleaded and R17.08 for 95 unleaded, while those at the coast will be paying R16.49 for 95.

During yesterday’s announcement of the adjustment of fuel prices effective from November 7, the Minister of Energy, Jeff Radebe, said that the main reasons for the fuel price adjustments were due to the contribution of the rand/US dollar exchange rate, the prices of crude oil, import prices of petroleum products and self-adjusting slate levy mechanism rules.

‘The rand appreciated, on average, against the US dollar (from 14.49 to 14.79 rand per USD) during the period under review when compared to the previous one. This led to lower contribution to the basic fuel prices of petrol, diesel and illuminating paraffin by 16.94c/* , 18.73c/* and 18.66c/* respectively. The average brent crude oil price increased from 78.89 USD to 81.03 USD per barrel during the period under review. The main contributing factors were the uncertainty ahead of the US sanction on Iran and ongoing trade tension between the US and China which has sparked concerns about the short- to medium-term oil demand. The international prices of petrol decreased slightly and diesel increased on average during the period under review,” Radebe said

“The price differential between petrol and diesel widened during the current fuel pricing review period due to concerns of regional supply in the US south-east which boosted north-western European and US East Coast diesel prices and the Northern Hemisphere approaching winter season.

“In line with the self-adjusting slate levy mechanism rules, the slate levy on petrol and diesel will be 21.92 c/* effective from the November 7 2018. The current combined slate account balance for petrol and diesel amounted to minus R2.2 billion which is below the threshold of minus R250 million The current fuel price adjustments are due mainly to the international factors, namely, the stronger rand and higher crude oil prices. Geopolitical tensions are having a very negative impact on crude oil prices and consequently refined product prices globally.”

Radebe added that based on current local and international factors, the fuel prices for November 2018 will be adjusted as follows: Petrol (93 octane, ULP and LRP): unchanged; petrol (95 octane, ULP and LRP): unchanged; diesel (0.05% sulphur): 47.92 c/* increase; diesel (0.005% sulphur): 50.92 c/* increase; illuminating paraffin (wholesale): 28.00 c/* increase; SMNRP for IP: 37.00 c/* increase; maximum LP gas retail price: 61.00 c/kg increase.