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South Africa faces another fuel hike ahead of elections

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South Africans can anticipate another fuel price increase on Wednesday, 1 May 2019, a mere seven days before the national elections.

The Central Energy Fund has released late-month unaudited fuel price data, which points to a petrol hike of around 53 to 54 cents a litre, effective as of 1 May 2019. Diesel-fuelled car drivers can sigh a breath of relief as prices for diesel are anticipated to remain unchanged or rise by two cents at most. Current trends are pointing to another possible increase in June due to a weak rand and bursting international oil prices. The final prices are expected to be announced on Friday, 26 April 2019.

A 53 cents increase will see the price of 95 Unleaded go up to R16.02 in the coastal areas, and R16.66 in Gauteng, while 93 Unleaded would retail at R16.47. Reports indicate that May’s fuel prices will be the second highest the country has ever dealt with, coming close to the record-holding price of R17.08 for a litre of 95 Unleaded for inland areas in October and November 2018.

On Tuesday, 23 April 2019, the rand posted its biggest decline in almost a month. The country’s currency has lost almost two percent since the last trading day on Thursday, 18 April 2019, dragged down by the disclosure that a R5 billion emergency bailout for Eskom from a Chinese loan had not arrived on time.

While rand strength did help absorb some of the fuel price pressure earlier in April, the local currency has in the last week lost significant ground to the US dollar, depreciating from the R13.92 mark on 15 April to R14.21 on 24 April of the month. On Wednesday, 24 April 2019, Brent crude was trading at R73.58.

Abenathi Gqomo
[email protected]

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