By Lehlohonolo Lehana.
The price of petrol 95 has breached the R30-a-litre mark for the first time in South Africa’s history, according to the Department of Mineral and Petroleum Resources (DMPR).
The retail price of 95-octane fuel in Gauteng will climb by R3.33 per litre on October 7, the DMPR said. The 12% increase lifts the price at the pump to R30.25 per litre, the highest on record. The wholesale cost of diesel will increase by as much as R3.24 per litre.
On the coast, a litre of unleaded 95 will be priced at R29.38, compared with the previous record price of R27.19 in that region.
The department attributed the increase to the average international product prices of liquid fuels increasing during the period.
Oil advanced to around $100 per barrel last month as the US and Iran continued to exchange attacks and Saudi Arabia’s East-West Pipeline was shut by a drone attack.
While that means higher fuel prices globally, the pain can be felt more keenly in Africa where households spend proportionately more of their earnings on transportation, due to a reliance on road travel and a lack of public transport.
It could also increase pressure on the South African Reserve Bank (SARB) to raise interest rates again to defend its 3% inflation target. Higher fuel prices since the start of the war in late February have already helped pushed consumer-price growth to 4.4%, prompting the central bank to raise rates twice so far this year.
Meanwhile Cosatu is calling on Parliament to urgently pass a Special Appropriation Bill that would unlock R10 billion for fuel-price relief.
The federation said the money should be channeled through the Central Energy Fund’s Equalisation Fund to cushion workers and consumers from the impact of soaring international oil prices.
COSATU Parliamentary Co-ordinator Matthew Parks says it is critical that Parliament passes this bill as a matter of extreme urgency.
“It is critical that Treasury and the Central Energy Fund move with speed and utilise this R10 billion to provide badly needed fuel relief for October and November. This would help ease the cost-of-living pressures facing workers and lower inflation, and prevent yet another devastating repo rate.”