Picture: ISTOCK
Picture: ISTOCK

After being hit hard by record high fuel prices, SA drivers’ hopes of a petrol price cut were dashed on Monday, with prices remaining unchanged.

The Central Energy Fund (CEF) said the prices of diesel would, however, increase by 48c/l and illuminating paraffin 28c/l from Wednesday.

The department of energy attributed the fuel adjustments to the rand’s appreciation and falling Brent crude oil prices.

“The average international product prices of petrol decreased, while diesel and illuminating paraffin increased during the period under review,” the department said in a statement.

Slight decrease

The average rand-dollar exchange rate between September 28 and November 1 was R14.48 compared to R14.47 in the previous period.

Based on unaudited data from the CEF last week, the Automobile Association was expecting a slight price decrease of about 16c/l in November.

However, the department could not do so since it was recouping losses from the once-off government intervention in the fuel price it made in September. In that month the increase was supposed to be 28c/l but the government intervened by taking 23c/l from the slate levy fund, amounting to R2.2bn.

The slate is the cumulative underrecovery in the fuel price for the month.

Prior to this, motorists were hard hit by seven consecutive months of fuel price increases.

Intervention

While the government “urgently” intervened in setting prices in September for the first time since the early 2000s, drivers faced a record high fuel increase in October.

At the time, the department said the intervention was a oneoff taken to alleviate pressure on consumers.

“They are trying to recoup the losses from September. This should get the slate back to where it was,” said Nedbank chief economist Dennis Dykes.

“This is not a well-explained decision,” he said.

The SA retail price of petrol and wholesale price of diesel is set every month by the department of energy’s CEF.

“Motorists will still have to tighten their belts this month despite the expected decrease,” said Dykes.

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