Great news about petrol prices in South Africa

Motorists are finally in for some fuel price relief this December, as petrol prices are set to come down by a considerable amount.

Unfortunately, the same cannot be said of diesel, which is likely to go up due to the reintroduction of fuel taxes.

This is according to new data from the Central Energy Fund (CEF) for the second week of November, which shows an over-recovery in the price of both fuels.

Petrol is currently on track for an over-recovery of between R2.86 and R3.12 per litre, while diesel is looking at a smaller over-recovery of between 97c and R1.34 per litre.

The improvement in fuel prices is predicated on movements in the global oil price, as Brent Crude fell after the US midterm elections, where the Democrats secured a major victory.

These are the CEF’s latest fuel price adjustment predictions at the end of the second week of November:

• Petrol 93 – decrease of R2.86 per litre
• Petrol 95 – decrease of R3.12 per litre
• Diesel 0.05% (wholesale) – decrease of R0.97 per litre
• Diesel 0.005% (wholesale) – decrease of R1.34 per litre

Unfortunately, the CEF’s estimates do not account for the General Fuel Levy (GFL), which will be partially reintroduced in December.

The National Treasury cut the GFL by R1.50 per litre for petrol and R3.00 per litre for diesel this November; however, 50c will be added back to the petrol price next month.

Diesel, on the other hand, will see R1.50 added back to the retail price. Since the fuel tax exceeds the over-recovery, diesel prices will actually rise slightly in December.

Brent Crude oil fell from a high of $116 per barrel in late October to $92 per barrel earlier this week after the US midterm elections, where the Democrats secured a majority in the House and Senate.

The Republicans’ defeat is attributed to the Trump administration’s unpopular war in Iran, with many hoping that this latest outcome will lead to a swift end in the conflict.

However, oil prices rose from $92 to $96 per barrel over three days after US President Donald Trump dismissed the idea of signing a deal with Tehran.

“We don’t need a deal with Iran,” Trump wrote in a post on Truth Social on Thursday.

“Those days have long since passed. We’ve got their money, hundreds of billions of dollars, and we’ve got their strait!”

Another contributing factor is the US dollar/rand exchange rate, as the rand’s value has weakened to R16.75 per USD, resulting in a paltry 1c per litre over-recovery in the Basic Fuel Price.

The following table shows how fuel prices will be affected in December after the re-introduced fuel taxes have been factored in: