The_Rorschach
Aug 21st, 2004, 01:47 AM
Iran trouble will make it much worse for 3rd world / marginal
nations. . .Notice that we've invaded Afghanistan and Iraq, pinning Iran between Coalition strongholds, and dependant upon next election, possible invasion.
http://www.iol.co.za/index.php?set_id=1&click_id=13&art_id=qw1092932463599B214
Petrol and diesel prices will rise steeply in September and October on the back of a multiplicity of fears, economists said on Thursday.
T-Sec chief economist Mike Schussler said he expected the retail price of 95 octane petrol in Gauteng to climb 25 to 30 cents in September from the current R4,35. (The pump price at the coast is R4,24.)
In October he expected a further 20 to 25 cent increase.
"The exact figures are still difficult to calculate because of the mercurial price of oil, racing up one day then plunging the next," Schussler said.
"All I can say, is it would have been worse but for the strong rand. That's saved us a bit."
If the increases come to pass, inland motorists will be paying close to R5 a litre for petrol in two month's time.
The wholesale price of diesel was expected to climb even more - 35 to 40 cents in September and 20 to 30 cents in October.
Schussler said the dire predictions were the result of heightened fears among oil market traders of supply disruptions, principally terrorism in the Middle East, the situation in Iraq, security concerns in Saudi Arabia, the Yukos court case in Russia, underproduction in Venezuela and the impact of Hurricane Charley in the United States - where oil prices have been additionally driven up by a shortage of refineries needed to process raw crude oil.
"These will all blow over with time as others will pick up the slack. It makes sense now to open up old wells or drill new ones. But that will take a year or two. In the meantime the problems remain, we can't say for how long, economists can't predict political developments."
On Thursday the Brent sweet crude spot price reached a new all-time record high of $43,5 (R281,88) a barrel (about 160 litres).
In New York light Texas crude's price was close to $48 (R311,04).
Schussler said the South African price usually tracked the Brent index. The New York price was more of a concern for US president George Bush than for South Africans.
Efficient Group economist Dawie Roodt agreed motorists were paying a substantial political premium at the pump.
He was also of the opinion that it was a temporary phenomenon.
"I think the natural equilibrium for crude is around $30, not $40," Roodt added.
He said the current prices would spur some oil producers to break their quotas and sell more while it would also spur the development of alternative energy sources.
Turning to the impact of the higher prices on the South African economy, Roodt said he was "not worried".
For it to have an inflationary impact, the rand would have to weaken to R7 to the dollar and oil rise to $50 ($324) a barrel "and it must stay there for some time."
The Department of Minerals and Energy's chief director for hydrocarbons, Henry Gumede, could not comment immediately on the developments.
He said the department would be able to give direction on its monthly price adjustments "tomorrow or on Monday".
The department would also then be able to say if it was planning further steps to assist motorists.
The department dipped into its Equalisation Fund in June to offset that month's steep fuel price increase.
Schussler said it might be wise for the department to use the fund again from October.
According to his calculations there were enough funds to carry the country three or four months - by which time the crisis should have passed. - Sapa
nations. . .Notice that we've invaded Afghanistan and Iraq, pinning Iran between Coalition strongholds, and dependant upon next election, possible invasion.
http://www.iol.co.za/index.php?set_id=1&click_id=13&art_id=qw1092932463599B214
Petrol and diesel prices will rise steeply in September and October on the back of a multiplicity of fears, economists said on Thursday.
T-Sec chief economist Mike Schussler said he expected the retail price of 95 octane petrol in Gauteng to climb 25 to 30 cents in September from the current R4,35. (The pump price at the coast is R4,24.)
In October he expected a further 20 to 25 cent increase.
"The exact figures are still difficult to calculate because of the mercurial price of oil, racing up one day then plunging the next," Schussler said.
"All I can say, is it would have been worse but for the strong rand. That's saved us a bit."
If the increases come to pass, inland motorists will be paying close to R5 a litre for petrol in two month's time.
The wholesale price of diesel was expected to climb even more - 35 to 40 cents in September and 20 to 30 cents in October.
Schussler said the dire predictions were the result of heightened fears among oil market traders of supply disruptions, principally terrorism in the Middle East, the situation in Iraq, security concerns in Saudi Arabia, the Yukos court case in Russia, underproduction in Venezuela and the impact of Hurricane Charley in the United States - where oil prices have been additionally driven up by a shortage of refineries needed to process raw crude oil.
"These will all blow over with time as others will pick up the slack. It makes sense now to open up old wells or drill new ones. But that will take a year or two. In the meantime the problems remain, we can't say for how long, economists can't predict political developments."
On Thursday the Brent sweet crude spot price reached a new all-time record high of $43,5 (R281,88) a barrel (about 160 litres).
In New York light Texas crude's price was close to $48 (R311,04).
Schussler said the South African price usually tracked the Brent index. The New York price was more of a concern for US president George Bush than for South Africans.
Efficient Group economist Dawie Roodt agreed motorists were paying a substantial political premium at the pump.
He was also of the opinion that it was a temporary phenomenon.
"I think the natural equilibrium for crude is around $30, not $40," Roodt added.
He said the current prices would spur some oil producers to break their quotas and sell more while it would also spur the development of alternative energy sources.
Turning to the impact of the higher prices on the South African economy, Roodt said he was "not worried".
For it to have an inflationary impact, the rand would have to weaken to R7 to the dollar and oil rise to $50 ($324) a barrel "and it must stay there for some time."
The Department of Minerals and Energy's chief director for hydrocarbons, Henry Gumede, could not comment immediately on the developments.
He said the department would be able to give direction on its monthly price adjustments "tomorrow or on Monday".
The department would also then be able to say if it was planning further steps to assist motorists.
The department dipped into its Equalisation Fund in June to offset that month's steep fuel price increase.
Schussler said it might be wise for the department to use the fund again from October.
According to his calculations there were enough funds to carry the country three or four months - by which time the crisis should have passed. - Sapa