South African motorists can look forward to paying less for fuel starting Wednesday, 4 September 2024, as the latest adjustments to petrol and diesel prices have been announced by the Central Energy Fund.
Story Summary:
- Petrol prices are set to decrease by R0.92 per litre.
- Diesel prices will drop by R0.79 and R1.05 per litre, depending on the sulphur content.
- Illuminating paraffin will see a significant decrease of R1.03 per litre.
Petrol prices: Here’s how much a litre may cost from Wednesday, 4 September 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.
According to the CEF, starting on Wednesday, the price of 93 and 95 octane petrol will decrease by R0.92 per litre.
Similarly, diesel prices are set to drop, with 0.05% sulphur diesel decreasing by R0.79 per litre and 0.005% sulphur diesel by R1.05 per litre.
The price of illuminating paraffin will also drop significantly by R1.03 per litre, making it more affordable for households that rely on this fuel for heating and lighting.
Here is a look at the estimated petrol price changes expected on Wednesday, 4 September 2024:
Inland
| TYPE | PRICE (p/l) | CHANGE |
| Petrol 95 | R22.13 | -R0.92 |
| Petrol 93 | R21.85 | -R0.92 |
| Diesel 0.05%* | R19.59 | -R0.79 |
| Diesel 0.005%* | R19.72 | -R1.05 |
Coastal
| TYPE | PRICE (p/l) | CHANGE |
| Petrol 95 | R21.34 | -R0.92 |
| Petrol 93 | R20.32 | -R0.92 |
| Diesel 0.05%* | R19.58 | -R0.79 |
| Diesel 0.005%* | R18.92 | -R1.05 |
Factors impacting petrol prices in September 2024
Several factors have contributed to the decrease in fuel prices for September.
One of the main reasons is the decrease in international oil prices.
Brent crude oil, a key benchmark for global oil prices, has stabilised at around $85 per barrel after a period of volatility. This has had a positive impact on the cost of importing fuel into South Africa.
Another factor is the strengthening of the South African Rand against the US Dollar during the review period from 2 August to 29 August 2024.
The average exchange rate improved to R18.06 per US Dollar, compared to R18.24 in the previous period. This appreciation of the Rand helped to lower the Basic Fuel Price (BFP), which is the main component in determining fuel prices in the country.
Additionally, the CEF noted a retail margin increase of 5.3 cents per litre on petrol to accommodate wage increases for service station staff.
Despite this increase, the overall reduction in international product prices and a stronger Rand have resulted in a net decrease in fuel prices.
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.
