Massive Petrol Price Increase Coming In November

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South Africans are in for a painful surprise as fuel prices are expected to increase by record numbers in November 2021.


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South Africans are in for a nasty surprise as fuel prices are expected to increase by record numbers in November 2021.
The Automobile Association (AA) has predicted that the price of petrol will increase by 99c while the price of diesel and illuminated price could rise by a whopping R1.42c. This will not only impact motorists but all consumers as fuel is an inflationary pressure.
The AA has called the increasing prices a catastrophe. They said, “The hikes in diesel and illuminating paraffin would be the largest in South African history, bearing in mind that this is only based on half a month’s data. R20 a litre for petrol is now a realistic scenario before the end of 2021,”.
“South Africans are paying at the pumps for weak governance, as one of the key indicators of the price of fuel depends on the exchange rate,” stated the AA
Investec Group Economist Annabel Bishop says that the oil price increase is going to be very damaging. She explains that increases in oil prices is not unique to South Africa as all oil importing countries experience similar levels of increases.
She says this is just an estimate and the remaining days of the month could actually cause these estimates to rise.
Bishop said, “the OPEC cartel that controls the price of oil internationally, you know your oil exporting countries in the main, they have been imposing quotas to keep the oil prices quite high but of course it's difficult for them to suddenly switch on or open the taps and quickly produce a lot more oil”.
Bishop explains that while the increase in prices are unavoidable, oil prices should decline in the early parts of 2022. This as the oil price is influenced by the Northern Hemisphere entering the winter season. She says that when the Northern Hemisphere leaves their winter, their demand for oil will decrease.
“We're going into the northern hemisphere winter now and they use oil for heating so that's also putting quite a bit of pressure on oil prices and of course as we move into the new year, as we get to the sort of February, March period next year obviously they're going to start leaving their northern hemisphere winter” concluded Bishop.

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