South African motorists are set to start the new year on a positive note, with fuel prices expected to drop significantly, according to the latest data from the Central Energy Fund (CEF).
After opening December with under-recoveries, fuel price recoveries improved steadily throughout the month, strengthening expectations of notable price cuts across petrol, diesel and illuminating paraffin.
Current projections point to a reduction of approximately 43 cents per litre for 93-octane petrol, while 95-octane petrol could decrease by up to 48 cents per litre. Diesel users are expected to benefit the most, with prices forecast to fall by between R1.22 and R1.33 per litre, depending on sulphur content.
Illuminating paraffin is also expected to see a welcome decrease of around 96 cents per litre.
Rand strength and oil prices boost outlook
The improved fuel price outlook is largely driven by a firmer rand and lower international oil prices, both of which have eased pressure on local fuel costs. Although more than a week remains before the month-end calculations are finalised, prevailing market conditions suggest that fuel price over-recoveries could strengthen further if current trends hold.
At the time of publication, Brent crude oil was trading at $62.52 per barrel, while the rand was exchanging at R16.64 to the US dollar.
Latest projected fuel price changes
According to the CEF’s most recent projections, the expected adjustments are as follows:
- Petrol 93: decrease of 43 cents per litre
- Petrol 95: decrease of 48 cents per litre
- Diesel 0.05%: decrease of 122 cents per litre
- Diesel 0.005%: decrease of 133 cents per litre
- Illuminating paraffin: decrease of 96 cents per litre
Fuel prices in South Africa are primarily influenced by two factors: the international price of petroleum products and the rand-dollar exchange rate used to purchase these imports.
The Department of Mineral Resources and Energy will announce the final fuel price adjustments later this month. The new prices are expected to take effect at midnight on Tuesday, 6 January, although an earlier implementation on Tuesday, 30 December, remains a possibility.
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