Cash-strapped consumers will experience some relief at the pumps this week as all grades of petrol and diesel decrease in price. The price of paraffin will also decrease, while there will be an increase in the price of gas.
The Department of Mineral Resources and Energy (DMRE) has announced the following fuel price adjustments:
- Both grades of petrol will decrease by 71 cents.
- Diesel with 0.05% sulphur will decrease by 84 cents.
- Diesel with 0.005% sulphur will decrease by 80 cents.
- Wholesale illuminating paraffin will cost 43 cents less.
- The Single Maximum National Retail price for illuminating paraffin will decrease by 58 cents.
- The Maximum LP Gas Retail Price will increase by 75 cents.
According to the DMRE, the average international product prices of petrol, diesel, and illuminating paraffin have followed the decreasing trend of crude oil prices. However, the price of LPG has increased.
The DMRE explains, “Lower contributions to the Basic Fuel Prices of petrol, diesel, and illuminating paraffin by 125.11 c/l, 133.83 c/l, and 94.95 c/l, respectively, have resulted from these factors.”
Despite increased demand leading up to the driving season in the Northern Hemisphere, petrol and diesel prices have decreased. The rise in LPG prices is attributed to increased Butane prices.
The decrease in the cost of Brent Crude Oil has also contributed to the lowered fuel prices.
Several factors have influenced this decrease, including:
- The release of Chinese Purchasing Managers Index (PMI) data indicating lower economic growth and an increase in crude oil imports to China at a slower pace than in April 2023.
- The collapse of a US bank (First Republic Bank), creating uncertainty and concerns of another financial crisis.
- The passage of the US debt ceiling bill, indicating the US government’s ability to meet financial obligations and preventing further decreases in crude oil prices.
- Unexpected inventory builds despite OPEC+ production cuts announced in April 2023, leaving uncertainty regarding possible further cuts in the upcoming June 2023 meeting.
These fuel price adjustments will take effect on Wednesday, June 7, 2023.
As this news offers relief to cash-strapped consumers, we encourage readers to share their thoughts and opinions in the comment section below.