• Unleaded 95 petrol may be hiked by 14c a litre, while unleaded 93 could rise by up to 18c and diesel prices could be more than 34c higher. 
• Oil prices have rallied to the highest levels since 2018 amid expectations that global demand may return to pre-pandemic levels sooner than expected. 
• There is still some time for July fuel prices to change, as oil and the rand fluctuate.

South Africans may want to brace themselves for fuel price hikes in the first week of July.

Based on current information from the Central Energy Fund, unleaded 95 petrol may be hiked by 14c a litre, while unleaded 93 could rise by up to 18c. Diesel prices could be more than 34c higher.

Petrol and diesel prices are largely determined by the oil price, as well as rand strength – given that SA must buy oil in dollar.

Oil prices have rallied over recent weeks, reaching the highest levels since 2018 amid expectations that global demand may return to pre-pandemic levels more quickly than previously anticipated.

Bloomberg reports that oil stockpiles are also draining fast as fuel consumption rebounds in key regions including the United States and Europe. “At the same time, the prospect of an imminent surge of Iranian oil is diminishing as talks to revive a nuclear deal drag on. The increasingly bullish picture is helping to fan speculation that Brent may eventually return to $100 a barrel.”

The United States, United Kingdom, and four other global powers have been negotiating with Iran for months over a deal that could see the country curb its nuclear activities in return for sanctions relief. This could see more oil from Iran flow into the global economy.

Brent crude was last trading at $76 per barrel, the highest level since October 2018.

• READ | More relief for motorists as petrol price to drop 10c/l

Meanwhile, the rand started the month at around R13.70/$ – but it was last trading around R14.15/$.

There is still some time for July fuel prices to change, as oil and the rand fluctuate. Fuel prices are adjusted by the Department of Mineral Resources and Energy on the first Wednesday of every month.

In the first week of June, both unleaded 95 petrol (R17.13 per litre), and unleaded 93 (R16.91) were cut by ten cents per litre.

Diesel (0.05% sulphur) was be hiked by 20 cents per litre and diesel (0.005% sulphur) increased by 21 cents per litre.

SOURCE:

Pain at the pump: Fuel price hikes now expected in July | Fin24 (news24.com)