Fuel prices decrease as of Wednesday, 7 October

Fuel prices are expected to decrease on Wednesday, 7 October, with the price of 93 octane petrol going down by 23 cents per litre.

The Minister of Mineral Resources and Energy Gwede Mantashe has announced the adjustment of fuel prices for October.

The price of 95 octane petrol will decrease by 32 cents per litre, the price of diesel will decrease by between 90 cents and 93 cents per litre and the price of illuminating paraffin will decrease by 76 cents per litre.

Other decreases include:

•           SMNRP for IP: one hundred and one cents per litre (101.00 c/l) decrease;
•           Maximum LPGas Retail Price: twenty cents per kilogram (20.00 c/kg) decrease;

The minister’s department said the fuel prices schedule for the different zones will be published on Tuesday, the 6th of October 2020.

The department said the adjustment of fuel prices is based on current local and international factors and that the country’s fuel prices are adjusted on a monthly basis, informed by international and local factors.

“International factors include the fact that South Africa imports both crude oil and finished products at a price set at the international level, including importation costs, e.g. shipping costs.

“The main reasons for the fuel price adjustments are due to:

1.        The contribution of the Rand/US Dollar exchange rate

“The Rand appreciated, on average, against the US Dollar (from 17.28 to 16.72 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 petrol, diesel and illuminating paraffin of about 17.93 c/l, 16.42 c/l and 14.75 c/l respectively.

2.         The decrease in the prices crude oil

“During the current fuel price review, the average Brent Crude oil price decreased from 44.78 USD/barrel to 40.82 USD/barrel.

3.    The Petroleum Products Prices

“On the finished products, the movement in international prices of all refined petroleum products decreased resulting in average over recoveries of over of 13.81 c/l & 5.82 c/l on petrol and 73.414 c/l & 75.73 c/l on diesel and 60.87 c/l on Illuminating Paraffin.

4.        Quarterly Octane Adjustments

“In line with the Working Rules to determine the Basic Fuels Prices (BFP), the BFP-differentials between 95 and 93 Octanes are adjusted on the first Wednesday of each quarter. The 95 octane (unleaded) grade is the price-marker grade and. The 95/93 octane price differential will be adjusted with effect from the 7th of October 2020.”

(Compiled by Makhosandile Zulu)

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