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South Africans need to buckle up and brace themselves for a steep rise in fuel prices in April.

The Automobile Association (AA) is predicting that the price of 95 octane could skyrocket by R2.15 a litre, and diesel between R2.51 and R3.08 a litre. It was commenting on unaudited mid-month fuel price data released by the Central Energy Fund on Wednesday.

These steep price hikes will see the cost of petrol rise to R24 per litre and R23.60 for diesel.

READ: Fuel price may hit R40 a litre

AA spokesperson Layton Beard said Russia’s invasion of Ukraine and its potential impact on global oil supplies is one of the major contributing factors to the looming fuel price hike. Russia is among the world’s three largest oil producers. Russian entities are facing sanctions due to the continuing onslaught by the country’s military, with trade, shipping and banking restrictions imposed.

In an interview with City Press, Beard said:

It is unlikely that the oil price is going to stabilise over the next two weeks and that the R2 increase is going to wipe out.

“The price of oil is taken on a daily basis and, when we look at March, we have two weeks to go, and it’s unlikely that any dip is going to take that average price down.”

South Africa will enter record-breaking territory if the fuel price does increase by anything over R1.70.

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“Ninety-eight percent of the reason is the international price of oil. The rand is performing well against the dollar. It’s impact, however, is so nominal that it is not a factor,” Beard added. “The worry is the supply.”

“Covid has, to an extent, not stopped many people from returning to work. There is a demand for oil. There are worries about supply.”

Beard added:

We are very concerned about the impact that this will have on consumers and the economy. It is not only affecting motorists; it affects every South African. It is very worrying.

Food prices are set to rise as a result of the continuing fuel price surges.

The price of Brent crude oil is $99.37 a barrel. Just last week, the cost skyrocketed to $140 a barrel after the US announced that it would ban the import of Russian crude oil.

March fuel price hike

As of March, it costs more than R1 000 to fill a 50-litre tank with fuel. At a pump price of R21.60 a litre, for a reasonably fuel-efficient car that gets 100km/litre, that works out to R1.30/km.

READ: Fuel and electricity price hike consume our budgets

In the past two years, the fuel price has increased 36%, or R5.76, per litre, and more pain is still to come. Not only are we likely to see further fuel price hikes, but we will also need to absorb a 9.6% electricity price increase next month.

While we can breathe a sigh of relief that the National Energy Regulator of SA did not approve the full 20% that Eskom requested, this follows a 15% price hike last year, so we will be paying 21% more for electricity than we did two years ago.

FNB economist Koketso Mano previously told City Press: “These hikes are far higher than any salary increases individuals have received or can expect to receive.”

SOURCE:

AA predicts fuel price will soar by up to R3 in April | Citypress (news24.com)