The price of petrol will go up by between 23 cents and 26 cents a litre from Wednesday, according to the Department of Energy.
In a statement on Sunday, Energy Minister Jeff Radebe said that the price of diesel will increase by 24c and 26c a litre while the price of illuminating paraffin goes up by 22 cents a litre.
Radebe said that he 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 12.51 to 13.29 Rand per USD) during the period under review,” he said.
“This led to a higher contribution to the Basic Fuel Price (BFP) on petrol, diesel and illuminating paraffin by 43.21 c/l, 44.36 c/l and 44.62 c/l respectively. The Rand’s movements were mainly influenced by global factors,” he added.
Radebe said the market has started to become worried about the effect that the trade war between the USA and China will have on the global economy.
Radebe said the other reason for the fuel price adjustment is the decrease in the price of crude oil.
“The average Brent Crude oil price decreased from 77.00USD to 74.00USD per barrel during the period under review,” the Minister said.
“The main reason for the lower crude oil prices is that the Organisation of Petroleum Exporting Countries (OPEC) and its allies agreed to increase production in order to retake market share from rivals and to calm prices to avoid blunting demand growth during their meeting on 22nd June 2018,” he added.
He said the lower crude oil prices cushioned the consumers from higher fuel price by close to 20 cents per litre.
The Minister said that the international prices of petroleum products decreased on average during the period under review which he said was “in line with the lower crude oil prices”.
