Motorists can expect another drop in fuel prices, marking the fifth consecutive month of declines. This trend brings a welcome relief to the motoring industry, following several months of sharp increases that left many drivers feeling the pinch.
Earlier in the year, fuel prices surged significantly, causing concerns about how much more consumers could bear. However, recent months have seen a slowdown in these price hikes, and further reductions in petrol and diesel prices are anticipated on the first Wednesday of October.
According to the latest report from the Central Energy Fund (CEF), petrol prices are projected to decrease by approximately R1.34 for 95 unleaded petrol and R1.25 for 93 unleaded petrol. Diesel prices are also expected to drop, with reductions of around R1.07 for 500ppm diesel and R1.13 for 50ppm diesel.
Despite these promising forecasts, it’s important to note that the outlook could change due to fluctuations in international oil prices, particularly given the ongoing conflicts in the Middle East.
If these predictions hold true, petrol prices will fall to their lowest levels since January 2022. At the coast, 95 unleaded petrol could cost around R20.06, while in Gauteng, it may drop to about R20.85. Meanwhile, 93 unleaded petrol in Gauteng is expected to fall to approximately R20.54.
The primary driver behind these reductions is the decline in global oil prices. South Africa relies heavily on imported fuel, either as crude oil for local refining or in its final form. Over the past four price review periods, from April 26 to August 29, the Brent crude oil price has decreased from over $88 (about R1600) per barrel to around $77 per barrel.
Additionally, the strengthening rand has played a role in the price relief, as oil and petrol are traded in U.S. dollars. During the same review period, the exchange rate improved from R18.81 to R17.76 per dollar.
Overall, this price drop is a significant relief for motorists, offering some respite from the previous financial strain.