Johannesburg - South Africans will be getting some relief at the pumps from Wednesday June 7 as the price of all grades of petrol is set to drop by 25 cents a litre, while both grades of diesel will see a 23 cent reduction.
According to the Department of Energy, motorists in Gauteng will now pay R13.32 for a litre of 93-octane Unleaded and R13.54 for 95 Unleaded, down from R13.57 and R13.79. A litre of 95 Unleaded at the coast will fall from R13.30 to R13.05 a litre.
This should translate to roughly R10 a tank if you drive a small hatchback such as the Volkswagen Polo Vivo, with the cost of a 45 litre refuel in Gauteng decreasing from to R610.65 to R599.40.
The department does not list retail prices for diesel as unlike petrol these vary from station to station, but it does quote wholesale prices of R11.57 (inland) and R11.18 (coastal) for 500ppm diesel.
*On the forecourt however, and depending on where you fill up, a litre of diesel is likely to cost you just over R13 in Gauteng from Wednesday.
The energy department attributes the June increase to a stronger rand during the month of May and lower international oil prices, this as data showed an increase in US oil inventories, which 'fuelled' concerns that markets remain oversupplied. This happened in spite of efforts by big producers such as Saudi Arabia and Russia to cut outputs.
Could July bring an even bigger price cut?
It’s too early in the month to tell, but so far the rand to oil price ratio is pointing towards a 66 cent-a-litre decrease.
While the Automobile Association expects oil prices to remain stable, the current political uncertainties remain a risk to the local currency in the long term, however.
News that the country is in a technical recession, which came to light on Tuesday, could also weaken the rand over the coming month.