July diesel spike concerning for ‘key pillars of economy', says petroleum association
While undoubtedly affecting motorists across the board, Wednesday's fuel price hike is especially concerning for logistics and agriculture, key pillars of South Africa's economy.
This was the sentiment of the South African Petroleum Retailers' Association (SAPRA), saying, 'the volatility adds further complexity to already tight margins'.
ALSO READ: Fuel price hike anticipated this July
Wednesday saw the price of diesel 500ppm rise from R18.53 to R19.35 (82c/litre increase); diesel 50ppm from R18.57 to R19.41 (84c/litre increase); petrol unleaded 93 from R21.24 to R21.79 (55c/litre increase), and petrol unleaded 95 from R21.35 to R21.87 (52c/litre increase).
This is the first increase to the price of fuel after a four-month reprieve.
SAPRA national vice-chairperson Lebo Ramolahloane said the adjustment is largely due to average global oil prices and exchange rate movements during June.
'Global tensions between the warring parties in the Middle East have contributed to short-term volatility in oil markets which, in turn, has impacted the monthly average of Brent crude and the rand/dollar exchange rate.
'This reflected in the resultant under recoveries that built up throughout June, increasing prices at our fuel pumps,' said Ramolahloane.
Ramolahloane says, while the current increase is disappointing, there may be some light on the horizon.
'If the ceasefire between Iran and Israel holds and tensions in the Middle East continue to ease, coupled with the recent weakening of the dollar and a further drop in international oil prices, there is a possibility that motorists could see a welcome fuel price decrease in the coming month,' he concludes.
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