South African motorists, brace yourselves! The financial rollercoaster ride isn’t over yet. After enjoying a bit of relief with petrol price decreases in January, it looks like February 2024 is gearing up to test your wallets again.
PLEASE NOTE: This article was updated to reflect unaudited CEF data from Monday, 5 February 2024.
Petrol price forecast for February 2024: Latest data suggests a slight rise at the pumps
After three months of financial breathing space, it seems the relief was short-lived. Brace yourselves for a 64 to 66 cents per litre jump for 93ULP and 95ULP petrol, and a not-so-pleasant 63 cents increase for diesel.
Even the illuminating paraffin isn’t spared, gearing up to be 47 cents more expensive.
So, what’s fueling this price surge? Two culprits are at play here. The international oil prices, always the life of the party, are contributing a hefty chunk to this increase.
Meanwhile, the rand’s shakiness against the US dollar is adding its own seasoning to the mix, albeit to a lesser extent.
Together, they’re setting the stage for a litre of 95ULP inland to leap from R22.49 to R23.15. Yep, it’s time to tighten those belts even further.
When do these price changes kick in, you ask? Circle Wednesday, 7 February 2024, on your calendars, folks. That’s when the new prices roll out, ready to make a dent in your wallet.
The Automobile Association (AA) isn’t mincing words here – they’re urging everyone to keep a close eye on their fuel consumption and adjust budgets accordingly.
With household budgets still reeling from the festive season’s hangover, this isn’t the news we wanted to hear. But hey, knowing is half the battle, right?.
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 basic fuel price (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.
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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, 7 February 2024.