The Department of Energy has announced the official fuel price changes for June 2020, showing a sharp increase for motorists.
Following two consecutive months of significant decreases in the fuel price as a result of a significant drop in demand, fuel prices are now set to rise again in June.
These are the changes:
- Petrol 93 and 95: R1.18 per litre increase;
- Diesel 0.05%: 22 cents per litre increase;
- Diesel 0.005%: 21 cents per litre increase;
- Illuminating Paraffin: 40 cents per litre increase.
The average international product prices for petrol, diesel and illuminating paraffin increased during the period under review, and the rand appreciated against the US dollar during the period under review, on average, when compared to the previous period.
The average rand/US dollar exchange rate for the period 30 April 2020 to 28 May 2020 was 18.1715 compared to 18.4771 during the previous period. This led to a lower contribution to the basic fuel prices on petrol, diesel and illuminating paraffin by 7.18 c/l, 6.90 c/l and 5.52 c/l respectively.
The increase for June in sizeable, but not unexpected, with the Automobile Association noting that a jump in price was anticipated in line with most of the world returning to more typical economic activity.
This has an effect on oil demand, which subsequently translates to movement in global petroleum costs.
“The global lockdowns under Covid-19 saw fuel demand plummet. The resulting oversupply left storage bunkers full, with the extraordinary outcome that oil prices in the USA briefly dipped below zero,” the AA said.
The association noted that crude oil prices used to calculate South Africa’s fuel prices had fallen in lockstep with the reduction in demand, but are now inching up as economic activity begins to ramp up on a global scale.
“This is not unexpected, and South Africans should remember that the fuel price (in May was) around R4 per litre lower than it was before the Covid-19 crisis hit. Fortunately, the rand has strengthened during May, which has helped insulate the country from some of the rise,” the AA said.
This is how the prices will be reflected at the pumps:
|Fuel (Inland)||May Official||June Official|
|0.05% Diesel (wholesale)||R11.08||R11.30|
|0.005% Diesel (wholesale)||R11.17||R11.38|