Fuel price: Cost of diesel to drop but petrol will be pricier on Wednesday

The Department of Mineral Resources and Energy (DMRE) has announced that both 93 and 95 octane petrol will increase by 37 cents per litre from Wednesday, 3 May 2023.

The price of diesel (0.05% sulphur) decreases by 73.5 cents per litre while diesel with 0.005% sulphur decreases by 47.5 cents per litre.

Meanwhile, illuminating paraffin will cost 33 cents per litre less, while the price of LP gas decreases by R4.44 per kilogramme.

Reason for petrol increase

DMRE spokesperson Robert Maake said there were several international and local factors that contributed to the adjustments in the petrol and diesel prices.

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Brent Crude price

Maake said the main reasons for the fuel price adjustments is the increase of the Brent Crude price.

“The average Brent Crude oil price increased from 79.24 US Dollars (USD) to 82.20 USD during the period under review.

“The Chinese GDP growth data, which is driven mainly by household consumption, mainly services; and the OPEC+ announcement of a further oil production cut of around 3.66 million barrels per day on 2 April 2023 [also played a part]. The impact of this will be experienced in the coming months when the production cuts are implemented,” Maake said.

Rand to US Dollar

The department said the rand appreciated, although slightly on average, against the US Dollar (from 18.30 to 18.12 rand per USD) during the period under review when compared to the previous one.

This led to lower contributions to the basic prices of petrol, diesel and illuminating paraffin by 12.25 c/l, 11.98 c/l and 11.62 c/l, respectively.

Slate levy

The department said the cumulative slate balance on petrol and diesel as at the end of March 2023 was positive.

“Therefore, there is no slate levy applicable in the petrol and diesel price structure for May 2023. This implies that the slate levy will decrease by 17.54 c/l,” it said.

Carbon levy

The department said Minister of Finance Enoch Godongwana, in his 2023 Budget speech, announced that an increase of 1.0 c/l will be made to the general fuel levy in the price structures of both petrol and diesel.

“Furthermore, an increase of 1.0 c/l will be added to the petrol and diesel price structures to allow the industry to recoup the levy payment for April 2023.

“This additional 1.0 c/l will be removed with effect from 7 June 2023. The fuel levy will increase in the price structure of both petrol and diesel to 396.0 c/l and 382.0 c/l, respectively, with effect from 3 May 2023,” the department said.

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