Fourth consecutive fuel price drop expected

Fuel prices in South Africa are expected to decline across the board in September, marking a fourth consecutive drop this year.

According to the Automobile Association (AA), preliminary mid-month data from the Central Energy Fund (CEF) indicates that petrol, diesel, and illuminating paraffin will reach their lowest prices of the year.

ULP95 petrol is projected to decrease by approximately 68 cents per litre, while ULP93 is expected to drop by 63 cents per litre.

Diesel prices are anticipated to fall by around 52 cents per litre, and the cost of illuminating paraffin is likely to decrease by about 78 cents per litre.

“These decreases, if materialised, will bring the price of fuel to levels seen at the beginning of the year and will come at a very critical time for South Africans who have had to dig deeper into their pockets to fill up their vehicles and food trolleys,” says the AA.

The CEF’s data indicates that the primary factor behind the expected fuel price decreases in September is the lower average international product prices. Additionally, the Rand’s relative strength against the US Dollar has contributed slightly, further improving the outlook.

Stable and lower fuel prices are essential in reducing inflation and the cost of goods and services, which would positively impact the economy if the trend of decreasing fuel prices continues.

“Naturally, this is welcome news for all South Africans and will certainly alleviate pressure on many households. However, the drop in fuel prices must not negate the need for a review of administered prices, including of the fuel price formula, which was announced in July by President Ramaphosa. We again call for this review to happen with urgency in the interests of finding long-term ways of mitigating fuel price hikes in the future,” concludes the AA.

Officially adjusted fuel prices will take effect on Wednesday 4 September. An announcement on the official adjustment will be announced by the Department of Mineral Resources and Energy (DMRE).

By Warren Hawkins and originally appeared in the Bloemfontein Courant