BIG fuel price hike!
THE Automobile Association (AA) has called on Mzansi to limit all non-essential travel.
The association says road transport is under pressure from unrest and the threat of fuel shortages.
It has warned that unaudited mid-month fuel price data from the Central Energy Fund reflected a risk of substantial fuel price hikes at month-end.
“Fuel prices were already trending higher before the widespread looting and unrest of the past few day. But now, the daily Rand/US dollar exchange rate has spiked from R14.35 to nearly R14.80 since 12 June.
South Africa imports a lot of fuel, which will inevitably cost more in Rand terms. Meanwhile, international oil prices remain on the advance, adding further pressure,” said the AA.
The mid-month data indicates that petrol is set for an increase of 87 cents a litre, diesel 58 cents and illuminating paraffin 56 cents, and the AA says it expects little respite before month-end.
The association notes that while the supply of fuel will not push the prices of fuels higher, the weakening Rand as a result of the riots will play a major role as the exchange rate is a key indicator for the local fuel price.
In a related development, South African Petroleum Refiners (SAPREF), which runs a massive refinery complex in Durban supplying 35% of South Africa’s refined fuel, has declared force majeure.
“SAPREF’s declaration of force majeure means that events beyond its control – the recent lawlessness has forced it to shut down the refinery,” the association said.
The association advised motorists to avoid unnecessary journeys and to buy no more fuel than necessary, to preserve current stocks for essential and emergency services.