Here is the expected petrol price for May 2016
South Africa motorists can expect yet another petrol price hike in May – although not as much as the 88 cents increase in April, thanks to a firmer rand.
According to senior researcher at Solidarity, Paul Joubert, if the current under-recovery on petrol remains as is until 28 April, the price of a litre of petrol – both grades – will rise by approximately 20 cents on 4 May 2016.
Under the same circumstances, wholesale price of diesel will fall by about 5 cents, he said.
“During April so far, the rand has on average been a bit stronger, at about R14.90, against the dollar than in March (R15.45), but the international bulk refinery-gate price of petrol has been significantly higher on average so far in April, while the international bulk price for diesel has been slightly higher.
“This significantly higher international bulk price for petrol has so far outweighed the benefit from the stronger rand, while for diesel the stronger rand just outweighs the higher bulk prices at the moment,” Joubert said.
Solidarity noted that the retail price of petrol and the wholesale price of diesel are adjusted monthly in South Africa according to the previous month’s international bulk prices of petrol and diesel in dollar, which are then converted to rand.
The price of oil does not play a direct role in the calculation of these prices – the dollar prices of refined petrol and diesel at international refineries are used.
The price of oil is only one of many inputs into the refining process, which explains why the petrol and diesel prices do not always track oil prices exactly, the research arm of the trade union said.
If the price increases by 20 cents, 93 octane petrol will cost R12.52 in Gauteng in May. This would still be marginally (0,6%) lower than in May 2015.
If diesel decreases by five cents, the wholesale price for diesel with 0,05% sulphur content will be R10.49, which is 6.2% lower than it was in May 2015.
Joubert cautioned that these expected changes to the prices are subject to much uncertainty, especially with the volatile markets at the moment.
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