Petrol price: Massive drop to give motorists further relief

South African motorists will pay much less for petrol and diesel from Wednesday.

This is good news for South Africans, with the South African Reserve Bank (SARB) likely to also cut the repo rate this month.

Petrol and diesel prices

The Department of Mineral Resources and Energy (DMRE) has announced that the price of both 93 and 95-octane petrol will drop by 92 cents per litre from Wednesday, 4 September.

The price of diesel (0.05% sulphur) will be reduced by 79 cents per litre, and diesel with 0.005% sulphur will drop by R1.05 cents per litre.

Meanwhile, illuminating paraffin will cost R1.03 less per litre, while the price of LP gas decreases by 10 cents per kilogramme.

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Reasons for petrol decrease

DMRE spokesperson Robert Maake said several factors contributed to the decreases in petrol and diesel prices.

Brent crude oil prices

Maake said the average international petroleum product prices decreased on average during the period under review in line with lower crude oil prices.

“This led to lower contributions to the basic fuel prices of petrol by 85.59 c/l and 78.40 c/l, diesel by 93.55 c/l and 67.63 c/l and illuminating paraffin by 91.86 c/l, respectively.

“The main contributing factors are the increased production from major oil-producing countries despite lower demand concerns and the anticipated interest rate cuts by the US Federal Reserve,” Maake said.

Rand/US dollar exchange rate

The department said the rand appreciated, on average, against the US dollar (from 18.23 to 18.05 rand per USD) during the period under review when compared to the previous one.

“This led to lower contributions to the basic fuel prices of all products by over 10 cents per litre.”

Slate levy

The cumulative slate amounted to a positive balance of R2.13 billion for petrol and diesel of at the end of July 2024.

“In line with the provisions of the self-adjusting slate levy mechanism, a slate levy of zero cents per litre remains in the price structures of petrol and diesel with effect from 4 September 2024.”

Annual wage adjustment for the forecourt staff

The Minister of Mineral Resources and Energy Gwede Mantashe also approved a 5.3 c/l increase in the price structures of petrol to accommodate the wage increase for forecourt employees, in line with the Motor Industry Bargaining Council (MIBCO) agreement.

This increase will also be implemented from 4 September 2024.

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