South Africans can look forward to more positive news as fuel prices are set to decrease in September for the fourth consecutive month in 2024. This comes on the back of data revealing consumer inflation has reached a three-year low, bringing relief to many households.
According to the Automobile Association (AA), unaudited data from the Central Energy Fund (CEF) indicates that 95 ULP petrol is expected to drop by approximately 94 cents per litre, while 93 ULP petrol is predicted to decrease by around 86 cents per litre.
The wholesale price of diesel is anticipated to fall by about 76 cents per litre, and the cost of illuminating paraffin is likely to decrease by nearly R1.01 per litre.
“The reason for this welcome news is the perfect combination of a strengthening Rand/US Dollar exchange rate since the middle of August, and significantly lower international oil prices which dipped around mid-August and increased the over recovery on the fuel prices in the period under review,” noted the AA.
The Association also highlighted that if these predicted decreases come to fruition, the cumulative impact of the last four months’ decreases will be substantial. For example, for ULP 93 Inland, the total decrease would amount to around R2.44 per litre, resulting in a saving of approximately R122 on a 50-litre petrol tank.
However, consumers should also be aware of an upcoming fuel retail margin increase that will take effect next month.
The Minister of Mineral and Petroleum Resources, Gwede Mantashe, has approved an increase of around 5 cents per litre to the fuel retail margin, which will coincide with the official adjustment for September. While this may slightly affect the overall decrease, the impact will be minimal.
“Lower fuel prices are good news for all consumers; apart from the immediate impact of buying cheaper fuel, input costs across various sectors are not impacted by higher fuel costs. At a time when most South Africans are still struggling to make ends meet, this is welcome news for all,” said the AA.
In addition to the anticipated fuel price decreases, the AA also welcomed the news that Minister of Finance Enoch Godongwana will soon present a “Fuel Price Intervention Plan” to Cabinet. This follows President Ramaphosa’s announcement in July regarding a comprehensive fuel review.
“This is a positive development and, we believe, long overdue. We have no illusions that finding ways to mitigate rising fuel costs will be an easy undertaking, but it is important that the government initiates a process that ultimately seeks to benefit consumers. We will monitor these developments closely and we are, naturally, at the ready to assist government in any way we can in this process,” the AA noted.
The official announcement by the Department of Mineral and Petroleum Resources (DMPR) regarding September’s fuel pricing is expected on Monday, 2 September 2024, ahead of the adjustment at midnight on Wednesday, 4 September 2024.
With the Automobile Association predicting a drop in fuel prices, what are your thoughts on this development? Share your views in the comment section below.
