Motoring

Buckle Up for Februworry: Fuel Prices Expected to Surge Next Month

Published

3 months ago

January 16, 2024

South African motorists might be less cheerful next month as fuel price hikes in February loom on the horizon, reversing the recent trend of decreases. Despite some relief in the past months, the Central Energy Fund’s mid-month snapshot suggests that small increases in petrol and diesel prices are likely. According to IOL, the fluctuating numbers between over-recovery and under-recovery make it challenging to pinpoint the exact price changes expected by month-end.

The CEF’s current month average hints at possible petrol increases ranging from 7 to 11 cents and a 3-cent rise for diesel. However, the latest daily under-recovery numbers, reaching up to 60 cents for petrol and 89 cents for diesel, indicate that the actual increases might be higher, possibly as much as 50 cents.

Also read: December’s Official Fuel Prices: Petrol Savings Diminished by Margin Hikes

While the exchange rate offers some relief to fuel prices, elevated international oil prices, currently around $78 per barrel for Brent Crude, contribute to the projected hikes. The oil price increases are due to recent air and sea strikes by the US and Britain on Houthi rebel targets in Yemen, following attacks on shipping in the Red Sea. The critical shipping route’s ongoing disruptions could continue to exert upward pressure on oil prices in the coming months.

Despite these global factors, the immediate impact on South African fuel prices will likely be minimal. After a 76-cent decrease in January, a litre of 95 Unleaded currently costs R21.77 at the coast and R22.49 in Gauteng, with 93 ULP retailing at R22.17. While petrol is now approximately R1 more expensive than in January 2023, diesel is 76 cents per litre cheaper than a year ago.

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