If you go down to the petrol pumps today, you’re in for a pleasant surprise! And there could well be MORE good news next month! Photo: Gallo Images / OJ Koloti
Weak rand spells BAD news for petrol price cut in September, BUT …
Data from the Central Energy Fund had indicated that SA motorists were to see a significant petrol and diesel price cut in early September.
If you go down to the petrol pumps today, you’re in for a pleasant surprise! And there could well be MORE good news next month! Photo: Gallo Images / OJ Koloti
Mid-month data from the Central Energy Fund had indicated that South African motorists were to see a significant petrol and diesel price cut in early September.
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According to the BusinessTech website, the data shows that the petrol price could see a decrease by as much as R2.60 per litre next month, while diesel will drop by slightly less at R2.30 per litre.
The mid-month snapshot was as follows:
- Petrol 95: decrease of 260 cents per litre;
- Petrol 93: decrease of 244 cents per litre;
- Diesel 0.05%: decrease of 230 cents per litre;
- Diesel 0.005%: decrease of 225 cents per litre;
- Illuminating Paraffin: decrease of 193 cents per litre.
However, in the last four days the rand has depreciated significantly against the dollar.
As recently as Sunday it stood at R16.17/$1, but at the time of publishing, that rate is now R16.68/$1.
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Local petrol price fluctuations are impacted by TWO main factors
Those are the international price of petroleum products, driven mainly by oil prices, and the rand/dollar exchange rate used in purchases of these products.
Below was the picture at 12 August, but it’s changed significantly since:
Oil prices
Brent crude was trading around $98.15 a barrel on Monday morning.
The good news on that front is that as of Thursday morning, that price has dropped further to $93.71 and if that trend continues, it could yet mean an even bigger decrease than previously expected.
Oil prices hit a high of $117 per barrel in June, but dropped to an average of around $105 per barrel in July.
Exchange rate
For months the rand has been working against local fuel prices, with its weaker position in the market undercutting the benefits from lower global oil prices.
At the time of publishing the rand/dollar exchange rate is R16.68/$1.
The rand remains at the mercy of the broader global environment and any shift in sentiment could see the currency tumble.
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The final overall price decrease (hopefully) will be confirmed later this month with the new price coming into effect at midnight on Tuesday, 6 September.
Go easy on the accelerator until then, Mzansi!
