Moroke Sekoboto
LOCAL motorists are feeling the pinch of this week’s fuel hike.
Petrol 93 increased by 30 cents per litre, while petrol 95, diesel 50, and illuminating paraffin, each rose by 45 cents per litre.
The higher fuel prices announced by the Petroleum Fund this week came into effect yesterday after two months (September and October 2024) of stability on the international fuel market. The global crude oil market had experienced a notable decline in prices during this period.
At the beginning of September, crude oil was priced at $73.21 per barrel. By the end of October, this price had dropped to $71.24 per barrel, reflecting a decline of approximately 2.8%.
Nevertheless, the average price of crude oil in November 2024 was anticipated to increase to $75.10 per barrel, representing a 2.7% increase from the previous month.
According to the Petroleum Fund, these increases were driven by escalating geopolitical tensions, particularly as Iran prepares to carry out retaliatory strikes against Israel.
Despite these price hikes, the report indicates that fuel prices remain slightly below levels seen at the beginning of 2024.
A major contributing factor to these market changes has been the 5.8 million barrels per day production cuts implemented by OPEC+.
OPEC+, which includes OPEC members and other oil-producing countries, was formed in late 2016 to exert more influence over the global crude oil market.
“OPEC has established a clear strategic approach, indicating it will not increase production levels unless market prices rise sufficiently to justify such action. This prudent stance reflects a prioritization of market stability over the immediate pursuit of increased production, highlighting a commitment to maintaining equilibrium within the global oil market,” said the Petroleum Fund.
