Pamphlet 24 Manipulated Exchange Rate;
When the Gold Mining Industry was carrying all the blame for the social and economic stratification of our population, I focussed on the Gold Price movement, in this presentation, I first take the reader / subscriber through the more familiar price escalation that has affected all our lives, as the Rand depreciates, the Petrol Price escalates.
Our first reflection is on the ‘Good Old Days’, when our Government controlled our Mercantilism Economy.
The South African Petrol Price 1970 to 1983
For the purposes of understanding the price movement, the last column in the table above, is the cost of a Barrel of oil, divided by what you are paying for petrol per litre, and the comparative factor, is how many litres per barrel you can put in the tank.
This factor is influenced by the depreciating rand, and the Government taxes levied.
The 1970 to 1983 trend in the above table, shows and average litre/barrel of 177.
As South Africa enters the Free Market Economy in 1983, the petrol price figures I sourced, shows the average litre / barrel factor, drop from 177 to 97, a price increase of 45% by 1985, within two years.
The following table I comment as on as follows:
The figures that I could source, commences in 2001, where the Litre/Barrel factor, for the period 2001 to 2007 is 71, an increase of 26,8% from 1985, this over a 20 year period.
The next important period is 2008 to 2011, the first term of President Jacob Zuma, the Rand / USD exchange rate is stable, the Crude Oil price increases over the period, however, with the 2010 Soccer World Cup taking place, our petrol price returns to the 1985 factor of 99 litres per barrel.
From 2012 to 2020, the litres per barrel has rocketed, the factor over this period is 66 litres/barrel, an increase of 33,3%.
In parting, we look at the 1970s costs of petrol, compared to the 2020 cost of petrol.
Note: The Crude Oil price from 1970 to 2020, over 50 years increases 160% total, 32% per annum,my question is, why should the consumer be paying annual increased rates at 10 times the international crude price escalation.
My mathematical ability does not allow me to calculate the petrol price increase over the 50 year period;
R 15,84 per litre, minus, R 0,0917, equals R 15,7383 over a 50 year period, = R 0,3148 per litre per year, on R0,0917, my crazy calculations indicate about 343,29% per year.