SOUTH African motorists are facing steep price hikes for both petrol and diesel in February.
According to the Automobile Association, mid-month data from the Central Energy Fund is pointing towards a petrol price rise of around 80 cents a litre, while diesel and illuminating paraffin are set to go up by 60 cents or more.
Paradoxically these price rises, which will certainly do some damage to the local economy, are as a result of upticks in global economic activity and sentiment, which has pushed up the price of crude oil.
“The problem is international oil prices, which have been consistently climbing with each passing day,” the AA said. “A general increase in positive sentiment as Covid-19 vaccines are rolled out has combined with upticks in global economic activity, pushing up demand for oil – and taking prices with it.”
Fuel prices set to cross R15 mark again
A petrol price rise of 80 cents would bring the cost of a litre of 95 Unleaded up to R14.96 at the coast and R15.66 in the inland regions, where the cheaper 93 Unleaded would rise to R15.49.
Worryingly, the next round of increases will also bring prices to close to the levels experienced this time last year, before Covid sent oil prices plunging, and when a litre of 95 ULP cost R15.39 at the coast and R16.16 inland.
Incidentally, the highest fuel prices ever recorded in South Africa were in October and November of 2019, when 95 ULP reached R16.49 at the coast and R17.08 inland. If oil prices continue to rise, without a significant claw-back from the rand, we could be there again very soon.