Petrol prices have been in an upward spiral since the start of the year, but motorists could get some much needed relief from the beginning of June.
The latest daily snapshot released by the Central Energy Fund (CEF) shows that a strong over-recovery has developed for both petrol and diesel, which could translate into substantial price decreases next month.
As it stands the month-average is pointing towards a decrease of around 42 cents for petrol, but if current trends highlighted by the latest daily data persist until month end, a price drop in the region of R1 per litre is more likely than not.
That would bring the price of a litre of 95 Unleaded petrol down to about R23.70 while the cost of 93 Unleaded could sink to R24.15 in Gauteng.
Diesel is looking set for decreases of between 69 cents (500ppm) and 74 cents (50ppm) according to the current data, and those numbers are also on an upward trajectory.
These fuel price predictions, of course, come with the usual big shiny caveat, as much could still change between now and month-end, particularly given the volatile situation in the Middle East.
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The current over-recovery is due to a combination of rand strength and lower international oil prices, the latter occurring as stronger inventories stoke fears of softening demand, Reuters reports. Brent Crude Oil was trading at $83 (about R1,536) per barrel at the time of writing on May 9, down from the previous month’s average of $88 (about R1,628).
Petrol up by R3 this year alone
The price of petrol in South Africa has risen by almost R3 per litre since January 2023, with the cost of 95 Unleaded at the coast having climbed from R21.77 to R24.70.
Diesel has been a bit more forgiving, with the wholesale price of 50ppm having gone up by R1.44 since the beginning of this year.
Lower diesel prices are particularly good news for the economy as transport costs have a bearing on general inflation.
Petrol rose by 37 cents in April - click here to see current prices.
Cross fingers and look out for more fuel price updates on IOL later in the month.