September fuel price outlook: modest relief expected
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Update, 1 September: Although late-month official data had implied that South African petrol prices would be reduced by around 11 cents a litre, the Department of Energy has announced a 4 cent increase for both grades of Unleaded, effective from Wednesday, 1 September. Our updated story explains why.
JOHANNESBURG - Following brutal fuel price increases at the beginning of August, which saw petrol increasing by 91 cents and diesel by 55 cents, prices look set to retreat slightly in September. However this will be of little consolation to motorists, who are already paying around 23 percent more for petrol than they were in January.
According to the Automobile Association, unaudited month-end data from the Central Energy Fund is pointing towards a petrol price cut of around 11 cents a litre, while diesel is looking set to go down by around 21 cents and illuminating paraffin by 12 cents.
This will bring the price of 95 Unleaded petrol down to around R17.47 at the coast and R18.19 inland, where 93 Unleaded will now cost R18.00.
The association attributes the slight price drop to sagging international oil prices, although the South African rand has not been allowing us to take full advantage of the situation.
"International petroleum prices continued their gradual retreat during August, having pulled back by around ten percent since the start of the month,” the AA said. “We attribute this mainly to the OPEC cartel, which increased oil production gradually during the first half until previous production restrictions were removed".
Unfortunately, however, the South African rand lost significant ground during August, depreciating from around 14.30 in July to daily highs of around R15.30. Thankfully, however, the local currency has gained back some ground in recent days and was trading at R14.64 at the time of writing.