Rising international petroleum prices have resulted in South Africans facing substantially higher fuel prices in March. This is according to the unaudited month-end fuel price data released by the Central Energy Fund.
The price of petrol is predicted to increase by around 73 cents a litre, diesel by 92 cents and illuminating paraffin by 74 cents.
The Rand/US dollar exchange rate has worked slightly in South Africa's favour during February, giving savings of up to nine cents a litre. However, this has been shouldered aside by fuel price rises which have come off their January plateau and advanced considerably.
These price hikes come as toll fees across the country increase tomorrow (1 March 2019) while additional increases to the General Fuel and Road Accident Fund levies will apply in April. An additional tax to the fuel price – the Carbon Tax – will come into force in June when an additional nine cents will be added to the price of petrol and an additional ten cents will be added to the price of diesel.
In the medium term, we expect world supply will slightly outstrip demand as the USA continues to make impressive progress with its domestic oil production. However, petroleum prices remain vulnerable to geopolitical shocks and we cannot rule out further price hikes in the first half of 2019.