South African motorists should brace for potential fuel price increases in January 2025.
UPDATE: The Department of Mineral Resources and Energy released the final adjustments to fuel prices, coming into effect on Wednesday, 1 January 2025. See the update below.
Final fuel price outlook for January 2025
The Central Energy Fund (CEF) data shows under-recoveries across petrol and diesel, while global oil prices and a weaker rand add to the pressure on fuel costs.
- Petrol 95 ULP is under-recovered by 24.44 cents per litre, signalling a likely price hike.
- Diesel 0.05% sulphur has an under-recovery of 25.12 cents per litre, pointing to a steeper increase.
- A weaker rand, trading at R18.53 per US dollar, adds to the cost of importing fuel.
These factors combined indicate that South Africans are likely to pay more for fuel in January.
RelatedPosts
Here’s a closer look at the over/under-recovery rates, as of Saturday, 28 December 2024:
| Fuel type | Official | Adjustment on 23/12/2024 | Adjustment on 16/12/2024 | Adjustment on 09/12/2024 |
| Petrol 95 | -R0.12 | -R0.24 | -R0.17 | +R0.09 |
| Petrol 93 | -R0.19 | -R0.31 | -R0.23 | +R0.02 |
| Diesel 0.05% | -R0.08 | -R0.25 | -R0.07 | +R0.32 |
| Diesel 0.005% | -R0.11 | -R0.28 | -R0.11 | +R0.30 |
How oil prices affect the January forecast
Brent crude oil, the international benchmark, has been trading at around $73.93 per barrel in December.
This slight decline from November’s average of $74.35 per barrel has not significantly eased fuel import costs and factors such as geopolitical tensions and OPEC+ production cuts continue to keep global oil prices elevated.
Additionally, the holiday season typically sees slower demand, but this has not translated into significant price relief for South Africa.
What does this mean for consumers?
Motorists in South Africa should prepare for fuel price increases in January. Petrol, including 95 ULP and 93 ULP, is likely to see significant hikes, with under-recoveries of 24.44 cents and 30.50 cents per litre, respectively.
Diesel users, especially those reliant on 0.05% sulphur, may face even steeper increases.
Households using illuminating paraffin may experience a slight relief, as this fuel type shows an over-recovery of 2.88 cents per litre, suggesting a small price decrease.
The Department of Mineral Resources and Energy will announce the official fuel price adjustments closer to the end of December when the final data for the month is assessed.
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
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.
