Mineral and Petroleum Resources Minister Gwede Mantashe has announced the adjustment of fuel prices, based on current local and international factors, effective February 5.

Petrol 93 and 95 (unleaded and leaded) will increase by 82c/ℓ, while diesel (0.05% sulphur) will increase by 105c/ℓ and diesel 0.005% by 101c/ℓ.

Illuminating paraffin (wholesale) will increase by 97c/ℓ, while the single maximum national retail price for illuminating paraffin will increase by 129c/ℓ.

The maximum liquefied petroleum gas (LPG) retail price will increase by 42c/kg.

South Africa’s fuel prices are adjusted monthly, informed by international and local factors.

International factors include the fact that South Africa imports both crude oil and finished products at a price set at the international level, including importation costs.

The average Brent Crude oil price increased from $72.78/bl to $77.41/bl during the period under review, owing to increased demand from cold weather in the northern hemisphere.  

There is also an anticipated increase in demand for oil from China following economic stimulation policies.

On the other hand, supply was affected by the Organisation of Petroleum Exporting Countries’ decision to delay production increase until April, as well as new sanctions against Russia and Iran, which could further constrain supply and result in higher freight rates.

Additionally, the prices of LPG have also increased on the back of higher freight costs amid the cold winter season in the northern hemisphere.

These factors led to higher contributions to the basic fuel prices of petrol, diesel and illuminating paraffin by 46.06c/ℓ, 66.26c/ℓ and 58.64c/ℓ respectively.

Further, foreign exchange and local currency weakness also impact on fuel prices.

The rand depreciated, on average, from R18.11 to the dollar to R18.73 to the dollar during the period under review when compared to the previous one.

This led to higher contributions to the basic fuel prices of petrol, diesel and illuminating paraffin by 36.85c/ℓ, 39.58c/ℓ and 38.61c/ℓ respectively.

Commenting on the implementation of the Slate Levy, Mantashe says the cumulative slate amounted to a positive balance of R4.05-billion for petrol and diesel at the end of December last year.

In line with the provisions of the Self-Adjusting Slate Levy Mechanism, a slate levy remains unchanged at zero cents per litre in the price structures of petrol and diesel.