As we move into July 2024, South African motorists are facing a split forecast for fuel prices, with potential decreases for petrol and increases for diesel and paraffin.
NOTE: The Department of Mineral Resources and Energy released the final adjustments to fuel prices, coming into effect on Wednesday, 4 July 2024. See the update below.
Early petrol price forecast offers another positive outlook for July 2024
Recent data shows an over recovery for petrol grades, meaning that the current selling prices are higher than what would cover the actual costs.
This typically leads to price reductions. For both Petrol 95 and Petrol 93, the over-recovery suggests that prices could be lowered, offering some relief to petrol users.
Conversely, diesel and illuminating paraffin are experiencing underrecovery, indicating that their costs exceed the selling prices.
This situation might lead to an increase in prices for these fuels, affecting not only motorists but also households that rely on paraffin for heating and lighting.
Here’s a closer look at the over/under-recovery rates, as of Wednesday, 26 June 2024:
| Fuel type | Official | Adjustment on 25/06/2024 | Adjustment on 07/06/2024 | Adjustment on 06/06/2024 |
| Petrol 95 | -R1.05 | +R0.68 | +R0.70 | +R0.76 |
| Petrol 93 | -R0.99 | +R0.74 | +R0.78 | +R0.80 |
| Diesel 0.05% | -R0.30 | -R0.12 | +R0.21 | +R0.35 |
| Diesel 0.005% | -R0.24 | -R0.18 | +R0.19 | +R0.31 |
With different trends for petrol and diesel/paraffin, motorists should plan accordingly.
Those using petrol might enjoy lower prices, while diesel and paraffin users need to prepare for potential cost increases.
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, 5 June 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.
