Motorists in South Africa can expect some relief at the pumps as the Energy Department has announced that all grades of petrol will drop from Wednesday.
Petrol (95 Octane, ULP and LRP) will decrease by 34 cents and 93 Octane by 29 cents. Diesel will decrease by 22 cents and 26 cents respectively, while illuminating paraffin will decrease by 29 cents.
South Africa’s fuel prices are adjusted on a monthly basis, informed by international and local factors. International factors include the fact that South Africa imports both crude oil and finished products at a price set at the international level, including shipping costs.
The main reason for the fuel price adjustments, according to the Department of Energy, is the contribution of the Rand/US Dollar exchange rate.
The Rand appreciated against the US Dollar from R14.10 to R13.27, on average, during the period under review when compared to the previous one.
“This led to a lower contribution to the Basic Fuels Price on petrol, diesel and illuminating paraffin by 42.03c/l, 42.75c/l and 42.90c/l respectively,” the department said.
The decrease was also attributed to the increase in the prices of crude oil.
The average Brent Crude oil price increased from 62.50USD to 63.77 USD per barrel during the period under review.
Brent crude closed at its highest in more than two years due to the shrinking US stockpile, while a key North Sea oil pipeline remains shut.
The repair of the pipeline is now complete and pressure testing is well underway. This led to higher prices of petroleum products in the markets