Good news predicted at the pumps in October

If predicted fuel prices materialise, motorists won’t have to pay as much at the pumps next month.

For the fifth month in succession, fuel prices are predicted to fall.

In the early months of the year, motorists were battered with hefty increases that left many wondering how much more consumers could stomach.

But that onslaught has eased in the past few months and indications are that consumers can look forward to further petrol and diesel price decreases on the first Wednesday in October.

According to the latest daily snapshot released by the Central Energy Fund a few days ago, the current strong over-recovery on petrol is pointing towards price decreases of around R1.34 for 95 unleaded petrol and R1.25 for 93 unleaded.

Diesel is looking set for smaller but still significant cuts of between R1.07 (500ppm) and R1.13 (50ppm).

As per usual cautionary, the outlook could change significantly between now and month-end, particularly given the volatility in international oil prices this year amid conflicts in the Middle East.

Should the above predictions materialise, petrol prices will reach their lowest levels since January 2022, with 95 unleaded retailing at around R20.06 at the coast and R20.85 in Gauteng, where 93 unleaded should decrease to around R20.54.

Slump in oil demand

The biggest factor impacting the decreases is the slump in global oil prices.

South Africa imports most of its transport fuel from overseas, either as oil to be refined into petroleum locally or in its final form.

Over the review period for the last four price adjustments – which ran from April 26 to August 29 – the Brent crude oil price has plummeted from more than $88 (about R1 600) per barrel to about $77.

The strengthening of the rand against the dollar has also contributed to the relief, as oil and petroleum are sold in United States currency.

During the last review period, the dollar-to-rand exchange rate went from R18.81 to R17.76.

Whichever way one looks at it, it’s a huge relief for motorists.