Motorists can expect to pay record prices at the pumps from Wednesday as a softer rand, combined with rising oil prices, continue to push petrol prices higher in 2018.
The rand weakened to three month lows against the dollar last week, before recovering moderately over the long weekend. However, on Monday (30 May), the rand came under renewed pressure against the major currencies in thin trade.
A litre of 93 petrol, currently at R14.23 a litre will go up to R14.72 – surpassing the record of R14.49 in December last year.
The price of diesel will increase by between 58 and 59 cents per litre, while illuminating paraffin will increase by 52 cents per litre.
The minister of Energy, Jeff Radebe said that the adjustment of fuel prices for May 2018 was based on current local and international factors.
He said that the main reasons for the fuel price adjustments are due to the contribution of the rand/US dollar exchange rate. The rand depreciated, on average, against the US dollar (from 11.85 to 11.95 rand per USD) during the period under review. On Monday the rand traded at around R12.44 against the buck.
“The rand’s movements were mainly influenced by global factors. The rand went through a period of volatility in April, mainly due to concerns over the China/USA trade tariff dispute that put pressure on the currencies of emerging markets, including South Africa.”
The average Brent Crude oil price meanwhile, increased from $65.71 to $70.36 per barrel during the period under review. The US crude oil inventories dropped by 1.1 million barrels as a result of a decline of 1.3 million barrels per day (bpd) in net crude imports, the department said.
“The crude oil market also found support in expectation that the Organisation of the Petroleum Exporting Countries (OPEC) production cuts will be sustained. OPEC and 10 rival producers have curbed output by a joint 1.8 million bpd since January 2017, and pledged to do so until the end of this year.”
This is what you can expect to pay in May:
|Fuel||April official||May official|
|0.05% Diesel (wholesale)||R12.75||R13.34|