Huge petrol price increases officially announced

The official petrol and diesel prices for February were announced by the Department of Mineral Resources and Energy, revealing a sharp jump in prices. 

Motorists can expect petrol prices to be increased by 75 cents per litre across both grades and the price of diesel to rise by between 70 cents and 73 cents per litre.

Projections for the fuel price in February have steadily deteriorated throughout January, going from no change at the beginning to a significant increase by the end of the month. 

This is predominantly due to a rise in the price of oil due to the conflict in the Middle East and rising geopolitical tensions.

The list below shows the price changes that will be reflected at the pumps starting Wednesday, 7 February 2024 –

• Petrol 93 – Increase of 75c a litre
• Petrol 95 – Increase of 75c a litre
• Diesel 0.05% – Increase of 73c a litre
• Diesel 0.005% – Increase of 70c a litre

The local pricing is still reflecting the surge in oil prices seen at the end of January when separate attacks in the Middle East – on US troops in Jordan and a hit on a fuel tanker in the Red Sea – sent prices to the highest point in months.

Oil prices shot to levels last seen when the Hamas attacks on Israel filtered through to markets worrying about escalations in November 2023.

However, at the start of the new week, tensions over the attacks have simmered slightly, reversing the spike but still leaving prices high. 

Layton Beard from the Automobile Association said the increases could have been even worse if the rand had not begun to hold its ground and reverse some of its weakness versus the dollar. 

Investec chief economist Annabel Bishop said the rand has found support in global macroeconomics, with the US avoiding a recession in 2023 and prospects of an interest rate cut by the Fed looking more certain.

“The US GDP data staved off some concerns, strengthening the case for a soft landing for the US while also reducing some degree of market expectations on the timing of the first cut in the US,” Bishop said.

For the rand, the currency will remain beholden to US inflation, Bishop said, with no notable chance of a US cut seen before May and prospects for a local rate cut only coming after that.

She said consumers will remain under pressure for some time due to the rising cost of living in South Africa, driven partly by the rise in fuel prices.