Mineral Resources and Energy Minister, Gwede Mantashe, has announced the adjustment of fuel prices for February 2024, which shows a hike in both petrol and diesel prices.
The price adjustments will come into effect from Wednesday, 7 February 2023.
Consumers will now pay 75c more for a litre of unleaded petrol of both grades (93 and 95), while the wholesale price of diesel will go up by between 70c and 73c.
The wholesale price of illuminating paraffin will be increased by 53c a litre and the maximum retail price for LP gas is going up by 37c per kg.
Reasons given for the country’s adjusted prices include international and local factors.
“International factors include the fact that South Africa imports both crude oil and finished products at a price set at the international level, including importation costs, for example, shipping costs,” the department explained.
The main reasons for the fuel price adjustments, according to the department, are due to the cost of the average Brent Crude oil, which increased from US $ 77.35 to US $ 82.03 in the past month.
The department also stated that the higher oil prices are attributed to the impact of the geopolitical risk or attacks on oil cargoes in the Middle East, particularly the Red Sea.
“This has caused an increase in shipping rates as ships are rerouted from the Middle East to Europe, using the longer and more expensive route around Africa since they cannot import from Russia.”
In addition, the cold weather has also affected production in the United States, which has recently been part of the output used to offset the production cuts by a larger group of the Organisation of the Petroleum Exporting Countries (OPEC+).
“This resulted in more than expected inventory draws.”
Meanwhile, the average international product prices of petrol, diesel and illuminating paraffin increased in line with the higher crude oil prices, while the rand/US dollar exchange rate played a role.
“The cumulative slate balance on petrol and diesel at the end of December 2023 had a positive balance of R1.1 million.
“Therefore, there will be no slate levy implemented in the price structures of petrol and diesel with effect from the 7th of February 2024.” – SAnews.gov.za