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If early data for the festive season’s petrol and diesel prices is anything to go by, Mzansi motorists’ Ke Dezemba vibe could actually be one of “Ho! Ho! Ho!” instead of “Oh! Oh! Oh!”.
The initial oil market turmoil sparked by the outbreak of the Hamas-Israel war, has settled into a state of relative calm, allowing for the downward trend in global oil prices to continue.
This, coupled with the rand strengthening against a softer dollar after the US Fed put the brakes on interest hikes, currently points to a significant drop in December fuel prices.
One almost feels tempted to entertain the cautiously optimistic “tank half full” outlook opposed to our usual “tank half empty” default setting…
The price of 95 unleaded petrol currently stands at R23.18 on the coast and R23.90 inland.
According to the latest data from the Central Energy Fund (CEF), petrol prices are showing an over-recovery of between R1.23 and R1.27 per litre, while all diesel grades could dip by R1.90 per litre.
For the first time since July 2023, this could see diesel and petrol prices drop below the R22/litre mark… A welcome relief for motorists as we head into the December holidays.
Diesel prices have risen by R5.40 in the three months between August and October, before dropping by 85 cents in November.
The wholesale price of 500ppm diesel is currently R23.44 on the coast and R24.16 inland.
Fingers crossed the current over-recovery trend persists as a substantial diesel price drop of almost R2 would lighten the load of transport costs impacting on general inflation.
ALSO READ: High fuel price forcing many to downgrade their cars
Fuel prices are primarily governed by the rand/dollar exchange rate and international oil prices.
Both the rand and the global price of petroleum products – which are driven by oil – are currently on track for less pain at the pumps in December.
At the time of writing, on 11 November, Brent Crude oil hovered around $81, a decrease from last month’s average of $88.7, which influenced current fuel prices.
The rand’s favourable exchange rate, currently at R18.60, also plays a crucial role in this equation.
According to the Department of Mineral Resources and Energy (DMRE), the CEF’s daily snapshots on the over-recovery and under-recovery of the basic fuel price do not encompass other possible modifications.
The department determines these adjustments, after considering various factors such as slate levy adjustments or retail margin changes whereby the controlled prices are adjusted on the first Wednesday of each month.
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