Mineral Resources and Energy Minister Gwede Mantashe recently announced adjustments to petrol and diesel prices effective from Wednesday, 1 May 2024
Petrol prices: Here’s how much a litre may cost from Wednesday, 1 May 2024
PLEASE NOTE: The petrol price adjustments listed below are directly quoted from the Department of Energy’s monthly press release. Despite our best efforts to ensure accurate reporting, it is still the sole responsibility of the reader to double-check petrol prices. Swisher Post, its parent company, partners and affiliates shall not be held liable for any consequence that arises from the journalistic duties performed in sharing this content.
From the start of May, consumers in South Africa will encounter new fuel prices.
Specifically, the price for 93 ULP and LRP petrol and 95 ULP and LRP petrol will increase by 37 cents per litre.
This adjustment comes as part of the monthly review and consideration of factors such as global crude oil prices and the exchange rate.
For diesel, the price adjustments in May 2024 are differentiated by the sulphur content in the diesel. Specifically, diesel with 0.05% sulphur will see a decrease of 30 cents per litre, while diesel with 0.005% sulphur will decrease by 36 cents per litre.
Here is a look at the estimated petrol price changes expected on Wednesday, 1 May 2024:
Inland
| TYPE | PRICE (p/l) | CHANGE |
| Petrol 95 | R25.49 | +R0.37 |
| Petrol 93 | R25.15 | +R0.37 |
| Diesel 0.05%* | R22.15 | -R0.30 |
| Diesel 0.005%* | R22.27 | -R0.36 |
Coastal
| TYPE | PRICE (p/l) | CHANGE |
| Petrol 95 | R24.70 | +R0.37 |
| Petrol 93 | R23.62 | +R0.37 |
| Diesel 0.05%* | R21.35 | -R0.30 |
| Diesel 0.005%* | R21.47 | -R0.36 |
Factors impacting petrol prices in May 2024
Several key elements have contributed to the adjustments in petrol and diesel prices for May.
Internationally, the average Brent Crude oil price rose to $88.10 per barrel, largely due to increased geopolitical tensions in the Middle East and continued production cuts by OPEC+ countries.
Additionally, the rand has depreciated against the US dollar, moving from R18.04 to R18.90 per USD, which affects the Basic Fuel Prices (BFP) across all products.
Moreover, changes in the international market have led to adjustments in the BFP contributions: a decrease for petrol by 34.41 cents per litre and an increase for diesel and illuminating paraffin.
Seasonal demand variations have also influenced these prices, with a decrease noted in diesel and paraffin prices due to reduced demand in the Northern Hemisphere following their winter season.
A Slate Levy of 21.92c per litre will continue to be included in the price structures of petrol and diesel to address the negative balance in the cumulative slate, which stood at a deficit of R2.73 billion at the end of March 2024.
Fuel-saving tips to cushion the blow
To mitigate the impact of rising fuel costs, consumers can adopt several fuel-saving strategies.
Regular vehicle maintenance, such as ensuring tyres are properly inflated, can improve fuel efficiency. Planning routes to avoid congestion and reduce idle times, along with adopting smoother driving habits, can also lead to significant savings.
Additionally, carpooling and the use of more fuel-efficient vehicles or alternative modes of transportation, such as cycling or public transport, can further help manage and reduce overall fuel expenditure.
Currency Fluctuations and International Prices
The recent period between 02 February 2024 and 29 February 2024 saw a depreciation of the Rand against the US Dollar, moving from an average of 18.7655 to 19.0186.
This depreciation, alongside increases in the average international product prices for Petrol, Diesel, and Illuminating Paraffin, contributed to higher Basic Fuel Prices.
These economic factors are instrumental in determining the cost adjustments, impacting both the industry and the consumer market.
Retail and Refinery Cap Adjustments
The Single Maximum National Retail Price (SMNRP) for illuminating paraffin was set at 2,137.0 c/l for the period leading up to 02 April 2024, marking an increase from the previous period’s price cap.
Additionally, the Maximum LPGas Refinery Gate Price was determined to be R 15,387.93 per metric ton, excluding VAT, for the same period, indicating a strategic pricing decision aimed at stabilizing the LPGas market.
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.
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
Petrol price adjustments are generally made on the first Wednesday of every month by the Department of Energy.
