From tomorrow (Wednesday), motorists will pay less at the pumps for fuel across the board.
According to an official announcement by the Minister of Mineral Resources and Energy, Gwede Mantashe, late yesterday, petrol is set to drop by between 68 and 71 cents a litre, with diesel down by between 67.8 and 69.8 cents a litre. Illuminating paraffin will be 95 cents cheaper.
The price drop will become effective at midnight tonight.
‘The rand has strengthened against the US dollar, pulling away from the lows of mid-December when concerns mounted over the economic impact of travel bans imposed as the Omicron variant of Covid-19 swept across the world.
‘The rand has since clawed its way back to around the R15.88 mark, some forty cents stronger than its mid-December low,’ said the Automobile Association (AA), commenting on the announcement.
The nett oil prices for December were also favourable, according to the association.
‘Benchmark international oil prices were mostly flat through the first three weeks of December, although they climbed back above $70 a barrel on concerns over the impact of the Omicron variant.’
The AA also said with Omicron resulting in considerable infection rates in the northern hemisphere, the possibility of lower consumer and industrial demand for petroleum products may follow, as was seen in the initial waves of Covid-19 in 2020 especially.
‘This could lead to a depressed oil price in the short to medium term. If so, that would bring some relief to South African consumers. However, this should not distract from the fact that the current fuel prices are still far in excess of what South Africans were paying just a few months ago.’
The association is still calling for a review of the fuel price structure, as well as an audit of the existing prices within that structure.
‘We were pleased that our calls in this regard have reached the ears of the Minister of Finance, Enoch Godongwana. We welcome his pre-Christmas comments that the fuel price structure needs a critical review, and we call on him to make quick work of this issue ahead of his 2022 budget speech in February.’
