What you need to know about SA’s upcoming fuel price cuts

According to the latest data, all fuel grades are now in line for a small cut in August.

A weaker oil price and relatively stable rand have now added 0.005% diesel to the list of possible cuts, which includes petrol 93 and 05 and 0.05% sulphur content diesel.

Although the price cuts are forecast to be minimal, the latest data from the Central Energy Fund indicates that the following decreases will come into effect in August:

• Petrol 93: decrease of 5 cents per litre
• Petrol 95: decrease of 9 cents per litre
• Diesel 0.05% (wholesale): decrease of 16 cents per litre
• Diesel 0.005% (wholesale): decrease of 3 cents per litre
• Illuminating paraffin: decrease of 10 cents per litre

However, the cuts are very close to a flat rate and any major weakening of the rand or sharp increase in oil prices could change these figures, BusinessTech reports.

On a positive note, the rand did strengthen to R18.26 to the dollar on Friday (26 July) and oil prices cooled down to just over $82 a barrel (from the $85 a barrel average seen for the month).

‘There are concerns about energy consumption in China, the world’s largest oil importer,’ Bloomberg Analysis said.

‘A slowdown in growth, a lack of major stimulus initiatives, and higher electric-vehicle usage are crimping demand expectations.’

On Monday, the rand edged higher at R18.27 against the dollar, 0.14% stronger than its previous close. Reuters reports that emerging market currencies like the rand will look towards the US Federal Reserve’s policy decision on Wednesday for further direction.

‘The Fed is expected to keep rates on hold but markets are looking for a more dovish outlook going forward,’ says Andre Cilliers, currency strategist at TreasuryONE.

Since August’s first Wednesday comes on 7 August, South Africans must wait an additional week for the official changes.

Sourced from: Bussinestech / Cape Town Etc.