As May 2024 approaches, South African motorists face potential fluctuations in the price of petrol and diesel, influenced by both local economic policies and global oil market trends.
UPDATE: On Monday, 29 April 2024, the Department of Minerals confirmed the official fuel price adjustments for April 2024. See the official adjustments below.
Early petrol price forecast offers negative outlook for May 2024
Recent data from the Central Energy Fund (CEF) reveals significant under-recoveries for petrol grades, with Petrol 95 and Petrol 93 reporting deficits of 61.505 cents and 60.079 cents per litre respectively.
This under-recovery indicates a likely increase in petrol prices, as costs currently exceed what consumers pay at the pump.
In contrast to petrol, diesel and illuminating paraffin have shown over recoveries. Diesel 0.05% and 0.005% are ahead by 26.591 cents and 36.636 cents per litre, suggesting potential decreases in their retail prices.
Similarly, illuminating paraffin, with an over-recovery of 18.912 cents per litre, may also see reduced prices.
Here’s a closer look at the over/under-recovery rates, as of Thursday, 25 April 2024:
Fuel type | Official | Adjustment on 25/04/2024 | Adjustment on 18/04/2024 | Adjustment on 11/04/2024 | Adjustment on 04/04/2024 |
Petrol 95 | -R0.37 | -R0.62 | -R0.32 | -R0.25 | -R0.03 |
Petrol 93 | -R0.37 | -R0.60 | -R0.30 | -R0.24 | -R0.03 |
Diesel 0.05% | +R.030 | +R0.27 | +R0.66 | +R0.004 | +R0.15 |
Diesel 0.005% | +R0.36 | +R0.37 | +R0.44 | +R0.08 | +R0.16 |
The global oil market remains a crucial factor in determining local fuel prices. Recent movements have seen Brent crude oil rise to $88.70 per barrel, an increase that could counteract some of the expected decreases in diesel and paraffin prices while exacerbating the rise in petrol costs.
Adjustments in local transport tariffs and changes in government-imposed levies also play a critical role in determining final fuel prices.
What goes into the final retail price of fuel in South Africa?
Determining the final retail price of petrol in South Africa relies heavily on the rand’s performance in currency markets and oil price movements.
Using this information, the CEF can formulate BFP estimates which, in essence, offer South African importers a snapshot into the cost of buying petrol from an international refinery, transporting the product and ensuring it against possible losses at sea and on land.
However, before the retail price of petrol is finalised at petrol stations, several additional costs are included in the BFP:
Government levies
- IP tracer levy (reimbursement to the oil industry for buying IP tracer dye and injecting it into IP to curtail the mixing of IP and diesel)
- General Fuel levy (tax levied by the government)
- Slate levy (to finance the cumulative under-recovery of the industry)
- RAF levy (to compensate for people involved in road crashes and accidents)
- Petroleum products levy (reimbursement to the pipeline users for the applicable NERSA tariff on transporting fuel through the pipeline)
Additional costs
- Wholesale margin (markup to the price of a product to account for wholesaling costs)
- Service cost recoveries
- Storage, handling and delivery costs
- Distribution costs
- Dealers margin (commission to the fuel pump dealers for retail operation)
- Zone differential (applicable to inland regions)
- Customs and excise duty
Monthly adjustments to fuel prices are made on the first Wednesday of each month based on these factors. The next changes will take effect on Wednesday, 1 May 2024.
Disclaimer: The petrol price forecasts provided in this article are based on speculative data and should be considered as such. The information has been sourced from the Central Energy Fund, and while we strive to present the most accurate and up-to-date information, Swisher Post does not guarantee the accuracy, completeness, or timeliness of the data. Prices can fluctuate due to a variety of factors beyond our control, including but not limited to changes in international oil prices, currency exchange rates, and government taxes. Therefore, Swisher Post shall not be held liable for any discrepancies or differences in the actual prices. Readers are advised to consult official sources for the most current petrol price information.