April fuel price hike expected to be smaller, though drop in diesel will be substantial. Image: iStock
A smaller than expected petrol price increase is awaiting motorists in April, with the owners of diesel vehicles set to benefit from a drop in prices.
Last week, preliminary data by the Central Energy Fund pointed to an uptake of 43 cents a litre for 93 unleaded and 42 cents for 95 unleaded, while diesel had been reported as heading for a scant one cent a litre drop.
According to the newest data projections though, a weaker international oil price has offset the rand deteriorating well past R18 against the US dollar.
The price of 93 unleaded is now expected to go up by 25 cents a litre and 95 unleaded by 26 cents.
More substantial though is diesel that is projected to drop by between 20 and 22 cents a litre depending on the octane level.
A big decrease is also expected in the price of illuminating paraffin, 68 cents versus the previously reported 41 cents.
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It is worth noting though that the amounts are not final as a third report, followed by the official calculation from the Department of Energy, is still to be tabled before the adjustments come into force on Wednesday, 5 April.
Weaker oil prices have been cited as the main reason for the current price outlook, as most recent pricing has seen it drop to below $80 a barrel despite the rand’s less than stellar performance.
“Oil has endured a bumpy year, whipsawed by aggressive monetary tightening from the Fed and optimism around China’s demand recovery,” BusinessTech quoted Bloomberg as saying.
“Further gains may be constrained in the near term, with OPEC forecasting a modest surplus in the second quarter, a typical period of soft demand prior to the summer. The price cap imposed on Russian crude is working.”
A big plus that could have seen matters turn the other way, was the decision not to raise levies repeatedly mentioned by the Automobile Association (AA) as threatening the livelihoods of many South Africans already buckling under the spiralling living costs and ongoing hikes in electricity tariffs.
“Fuel levies are traditionally increased in April, but the minister of finance heeded calls by the AA and in his February budget speech indicated that this will not happen this year. Although not a saving as such, any increases would have added additional pressure to fuel prices, and we again welcome his decision not to increase these rates for 2023,” a statement from the AA read.
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