Petrol and diesel prices in South Africa are expected to come down significantly in October, according to mid-month data published by the Central Energy Fund.
The group reports an over-recovery on fuel prices across the board, which if maintained throughout the rest of the month could see petrol prices drop by as much as 36 cents per litre, and 88 cents per litre for diesel.
These are the expected changes at mid-August:
- Petrol 95: 36 cents per litre decrease
- Petrol 93: 27 cents per litre decrease
- Diesel 0.05%: 85 cents per litre decrease
- Diesel 0.005%: 88 cents per litre decrease
- Illuminating paraffin: 82 cents per litre decrease
These adjustments are based on the continued decline in the price of international petroleum, as well as the stabilisation of the rand/dollar exchange rate at a lower level.
The rand has stabilised under R17.00 to the dollar, having been trapped in the R17.20 and R17.60 range for most of August. Prices have settled at around R16.60 to the dollar, as markets await guidance from major central banks.
The South African Reserve Bank’s Monetary Policy Committee will announce a decision on rates this week, which is likely to provide some direction – while the US Federal Reserve and the Bank of England are also expected to make announcements which could swing investor sentiment.
Exchange rate movements have contributed around 18 cents per litre to the over-recovery of fuel prices.