Fuel price goes up at midnight thanks to carbon tax and weak rand

Fuel prices will rise by 9c a litre for petrol and 33c for diesel on Wednesday, the national energy department announced on Tuesday.

Wholesale paraffin goes up by 8c and illuminating paraffin (SMNRP) by 10c, while liquid petroleum gas (LPG) drops by 7c/kg.

This means that inland motorists will pay R16.57 for a litre of 93-octane petrol, R16.76 for 95-octane petrol, R15.21 per litre for diesel with 0.05% sulphur and R15.27 per litre for diesel with 0.005% sulphur.

The latest fuel price hike follows the introduction of the carbon tax levy, which finance minister Tito Mboweni announced during his budget speech on February 20. This add 9c per litre to the price of petrol and 10c per litre for diesel.

The department said the rand depreciated against the US dollar between April 26 and May 30, leading to a higher contribution to the fuel prices.

Exacerbating the problem is the fact that the petrol and diesel slate balances at the end of April 2019 were nearly R1.41bn in the red.

“In line with the provisions of the self-adjusting slate levy mechanism, a slate levy of 13.16c per litre will have to be implemented into the price structures of petrol and diesel with effect from June 5,” said the department.

The Automobile Association (AA) of South Africa said the slate levy is used to claw back losses from fuel price under-recoveries when the cumulative petrol and diesel slate balances exceed R250m.