Petrol prices take a turn for the better in South Africa

November’s petrol and diesel price adjustments have continued to improve with a smaller hike on the cards for motorists next month.

At the start of October, data from the Central Energy Fund (CEF) indicated that South Africa would be hit with massive price hikes of R4.6 per litre for petrol and R3.19 per litre for diesel.

However, these figures have fallen considerably since then, with the CEF now reporting that both fuels will experience an under-recovery of less than R3 per litre.

If this downward trend continues, there is a chance that fuel prices may see a reduction in November, though this is highly dependent on how the war in Iran continues to unfold.

These are the CEF’s latest fuel price adjustment predictions as of mid-October:

• Petrol 93 – increase of R2.68 per litre
• Petrol 95 – increase of R2.78 per litre
• Diesel 0.05% (wholesale) – increase of R1.45 per litre
• Diesel 0.005% (wholesale) – increase of R1.59 per litre

The lower fuel price adjustments are the result of improved oil flows in the Middle East, which have spurred market optimism.

Saudi Arabia is looking to bolster its ability to ship oil without having to navigate the Strait of Hormuz.

Saudi Aramco could add 1.2 million barrels per day of export capacity within seven to eight weeks by repurposing existing gas pipelines.

“The push comes even after Middle East oil flows recovered sharply in recent weeks. Some Wall Street banks have said crude shipments from the region had returned to near pre-war levels,” reported Bloomberg.

“To further ease the supply tightness, Group of Seven nations and partners have also announced a 100-million-barrel release from strategic reserve earlier this month.”

However, while there have been positive developments, oil prices are still alarmingly high, with Brent Crude trading at $104 per barrel.

Because of this, the CEF reports that South Africa will still experience an under-recovery in the Basic Fuel Price of petrol and diesel this November.

Unfortunately, the exchange rate isn’t faring any better, as the rand has fallen to R16.48, resulting in a higher contribution to the Basic Fuel Price.

The following table shows how fuel prices will be affected in November, based on the current projections:

Petrol 93 price 2 October – 12 October

Petrol 95 price 2 October – 12 October

Diesel 0.05% price 2 October – 12 October

Diesel 0.005% price 2 October – 12 October