The Central Energy Fund (CEF) has confirmed that South African motorists are getting some relief at the pump, with petrol prices dropping for June. This welcome news can be attributed to a decline in global oil prices and a strengthening South African Rand.
All fuels will cost less from 5 June 2024 after the CEF released the official fuel price adjustments for the sixth month of the year.
Fuel Price Adjustments For June 2024
- Both Grades of Petrol 93 & 95 (ULP & LRP) will decrease by R1,24c per litre
- Diesel 0.05% Sulphur will decrease by R1,18c per litre in wholesale price
- Diesel 0.005% Sulphur will decrease by R1,08c per litre in wholesale price
- Illuminating Paraffin (Wholesale) will decrease by 80 cents per litre decrease in wholesale price
- Illuminating Paraffin (SMNRP) will decrease by R1,07c per litre in the Single Maximum National Retail price (SMNRP)
- Maximum Retail Price for LPGAS 135.00 cents per kilogram decrease in the maximum retail price
Why The Price Of Petrol Is Falling
The average international price of petrol has decreased significantly compared to the previous period. This means the basic cost of the product South Africa imports is lower.
The South African Rand has appreciated against the US Dollar. Since oil is priced in dollars, a stronger Rand means it takes less Rand to buy each barrel of oil, effectively reducing the import
The combined effect of these factors is a significant drop in the Single Maximum National Retail Price for petrol. This means that from 5 June to 2 July 2024, South Africans will be paying around R1.07 less per litre for petrol compared to the previous month.
Expert Predictions
In the lead-up to the latest fuel price adjustment announcement the Automobile Association of South Africa (AA) said while a decrease in the price of fuel is positive news, petrol prices are still higher than they were earlier this year.
AA spokesperson Eleanor Mavimbela predicted the petrol price could fall by approximately R1,00 a litre. They also anticipated that the cost of diesel and illuminating paraffin are also expected to have a considerable drop in price.
For the period under review in May, we've been extremely fortunate to see International product prices going on a downward trajectory for the entirety of May as well as the rand strengthening a lot against the US dollar and that has contributed quite a lot to the decreases
The AA says they've been requesting a meeting to discuss alternative mechanisms for calculating fuel prices to find a more sustainable solution. The AA believes this will allow South Africans to better budget for transportation costs in the face of rising overall expenses.
