THE Department of Mineral Resources and Energy has announced a massive petrol price hike of R2.43 (per litre for 93 octane), while 95 octane will increase by R2.33 per litre from 1 June.
The prices of diesel (0.05% sulphur) will increase by R1.10 per litre, while diesel (0.005% sulphur) increased by R1.07 per litre.
The steep increases were driven by the Brent Crude oil price increasing from $104.78 to $115.00 compared to the previous assessment period.
The rand also weakened significantly against the dollar over the same period, from R14.90 to R15.95.
Given the ‘no-normal’ market environment, government said it will continue to monitor the impact of the Russia/Ukraine conflict and zero-COVID policies, which continue to have an impact on energy and food prices and result in supply chain shocks, with the aim of investigating further measures to make households and businesses less vulnerable to such shocks.
The price increases for petrol, diesel, and illuminating paraffin will be as follows:
Unleaded 95 petrol — Increase of R2.33
Unleaded 93 petrol — Increase of R2.43
50ppm diesel — Increase of R1.07
500ppm diesel — Increase of R1.10
Illuminating paraffin — Increase of R1.56
Earlier on Tuesday, Finance Minister Enoch Godongwana announced an extension of the temporary reduction in the general fuel levy (R1.50 c/l) until July 5, 2022, with effect from June 1, 2022.
In a joint statement released earlier on Tuesday, the finance and mineral resources and energy departments said the continuation of the Russia/Ukraine conflict, supply chain bottle-necks and a tightening of global monetary policy have led to further unfavourable changes in the rand/dollar exchange rate and global oil price, leading to even larger increases in fuel prices compared to when the temporary fuel levy relief was first introduced.
“The withdrawal of the temporary relief in the general fuel levy… as per the original announcement, would [have contributed] to an increase in petrol prices of close to R4 per litre, and push prices of 95 octane unleaded petrol [ULP] to above R25 per litre, an increase of just under 20%.”
In a separate statement, Minister of Mineral Resources and Energy Gwede Mantashe said the main reasons for the June fuel price adjustments are due to the average brent crude oil price increasing from $104.78 to $115 during the period under review.
“This in turn was due to increasing [oil] demand in the northern hemisphere, EU discussions regarding imposing sanctions on Russian crude oil and petroleum products, as well as the increase of crude oil throughput by refiners to take advantage of high refining margins.”
Mantashe added that the average international product prices of petrol, diesel and illuminating paraffin increased during the period under review while the price of LPG decreased.
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