Motorists in South Africa will need to brace for further pain at the fuel pumps in October, with yet another sharp increase in the petrol price likely due to rising crude oil prices.
Citing the latest information from the Department of Energy on Friday, independent economist Fanie Brink said that the price of gasoline 93 (ULP & LRP) in Gauteng could increase by 31.3 cents per litre next month, while the price of diesel with a 0.005% sulfur content could rise by 32.8 cents per litre.
Brink said that the average daily Brent crude oil price has risen to $55.50 a barrel over the past two weeks, mainly due to the increased demand for crude oil in the international market and the supply constraints of the members of the Organisation for Petroleum Exporting Countries and Russia.
“The higher crude oil price has resulted in sharp increases in the average international prices of petroleum products, which could cause possible increases of 43.3 cents per litre in the gasoline price and 44.8 cents per litre in the diesel price,” he said.
The economist noted that while the daily average dollar/rand exchange rate has strengthened to R/$12.75 over the past two weeks, it has since weakened again to R/$13.12 – but it will, at this stage, lower both the gasoline and diesel prices by 12 cents per litre.
The final price changes will be announced by the Minister of Energy towards the end of September.
A survey conducted by insurer 1Life in August showed that South Africans are struggling financially, with high levels of debt putting pressure on households and leaving little room for monthly expenses.
The group conducted the survey in July, testing consumers’ understanding of saving and financial responsibility.
Addressing the survey results, 1Life said that despite knowing how important saving is – respondents are struggling to save even the minimum each month. Half the respondents indicated that they could only save less than 5% of their monthly income, while a high number said that they depend on a credit card to ‘get by’ each month.
The survey also revealed that a significant proportion of South Africans have had to use other methods – loans, store credit – to cover costs. Only 15% of respondents indicated they could save more than 10% of their income each month.
1Life’s research suggested that, while 77% of respondents have a monthly budget in place, high levels of indebtedness indicates that financial planning is simply not working.
Additional research by the insurer put South African debt levels at around 72%.
“This indicates that for every R100 a person earns, R72 goes towards debt, leaving little room for monthly expenses and tangible financial obligations – let alone inflation,” the group said.
This echoes sentiments from debt counseling company, Debt Rescue, which recently said that there has been a marked increase in the number of consumers seeking relief by going under debt review since the start of the year.
Here’s are the expected prices for October:
|Fuel||September official||October expected|
|0.05% Diesel (wholesale)||R11.71||R12.04|