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Up and coming petrol increases
Petrol increases are around the corner, so make sure you fill up in time...
The petrol price in South Africa is a tightly controlled commodity. We have a bunch of bureaucrats to administer the price of petrol and with oil currently hovering at just over US$40 per barrel; fuel prices have been relatively stable, for the moment.
On the 1st of April the next set of price adjustments are expected. The levy on petrol is going up by 23 cents per litre, diesel by 24 cents per litre and the Road Accident Fund levy on both goes up by 17.5 cent per litre.
With all taken into account, this means that motorists can expect to pay an additional 40.5 cents per litre for petrol and 41.5 cents per litre for diesel. This has in part been fuelled by the weaker Rand and a change in the price of oil is reflected and magnified by our weaker currency
The current oil price is a reflection of just how deep the recession in top oil consuming countries is. What is worrying to most economists are the changes that will come when the world economy reverses and becomes stable yet again. The demand for oil will increase and the prices increase in conjunction with this.
As the present oil supplies are sufficient to meet the weak demand, the production is however still declining rapidly and the current price of US$40 is still not enough to support any investment in future supplies. The declining oil supplies are also not being helped by the low price of fuel as it prevents the efficiency required to take the ease off declining oil supplies.
The unfortunate truth is that petrol may be cheap now (in comparison to the R10 per litre we were paying about 6months back), but it is more than likely going to breach the R10 per litre trend yet again. However, according to Iafrica.com, some economists believe that we have seen the last of large petrol price increases for the year as both the rand and the price of oil are expected to recover thus ultimately leading to the two effectively balancing each other out.
Here at Justmoney.co.za the only advice we can offer in these trying times is try to cut back on costs to increase your savings wherever possible. Price changes are inevitable but by simply being prepared things may not seem quite as difficult. Pay back your debtsand invest in your future. Petrol prices are about to increase so be sure to fill up before the 1st April and adapt your way of thinking to one that financially forward. Open asavings account, keep an eye on your budget and wait for the markets to calm down and find their stability again.