Absa has released a new report focusing on the factors fueling South Africa’s petrol prices hikes.

South Africa faced its fifth consecutive hike in August, with analysts warning that further hikes could last all the way until 2019.

According to the South African Petroleum Industry Association, the government regulates the price of petrol. The prices are recalibrated on the first Wednesday of every month by the Central Energy Fund (CEF) on behalf of the Department of Energy (DOE).

Absa notes that there are several factors at play in determining this price, including:

International and external factors – The Basic Fuel Price (BFP) is essentially what it costs an importer to buy petrol from a refinery and bring it all the way to South Africa. However, the dollar/rand exchange rate can sometimes create an unexpected spike in the import costs.

Local factors internal factors – Local factors include the cost of shipping and other direct costs such as transportation, service, taxes and levies, wholesale and retail margins. Unlike petrol, diesel prices are not regulated. However, petrol importers try to keep the margins on diesel similar to petrol.

The pie chart below shows you exactly how the price of petrol is divvied up following the latest budget: