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Motorists should enjoy cheaper fuel while it lasts, before prices rise again in the northern hemisphere winter.
This is according to economist Mike Schussler, as the price of petrol dipped on Wednesday.
The national Department of Energy announced the following price decreases effective from Wednesday:
* Petrol (95 ULP and LRP): 85.0c/l.
* Petrol (93 ULP and LRP): 89.0c/l.
* Diesel (0.05 percent sulphur): 62.58c/l.
* Diesel (0.005 percent sulphur): 61.58c/l.
Schussler, from economists.co.za, said: “If you look at average South African motorists, they use about 140 litres a month – although that may be pushed up a bit by salespeople who travel more than others.
“But it works out to be roughly R125 difference to monthly income. It’s quite a significant decrease – almost the same as a 1.5 percent interest rate cut on a R100 000 bond.”
Schussler said South Africans had cut back on retail spending in the past few months, which suggested they were taking financial strain. “So this fuel price cut is to be welcomed,” he said.
He expressed happiness that the oil price was no longer being kept high by a “fear factor” – a reference to continued Middle East political uncertainty.
“Unless politics starts playing a role again, our fuel price may even come down again in a few months,” he said.
But he warned it would probably start rising again towards the year-end, as the temperature in the northern hemisphere plummeted and people there started buying more oil to keep warm – with the subsequent increase in demand likely to push up prices again.