South African motorists can expect a slight reprieve at the pumps in March, with several fuel price categories set to decrease following a series of price hikes in recent months.
According to month-end data from the Central Energy Fund (CEF), the anticipated changes reflect international oil prices and fluctuations in the rand-dollar exchange rate.
The CEF’s review of March’s fuel pricing revealed the following adjustments:
-Petrol 93: An increase of 7 cents per litre
-Petrol 95: A decrease of 7 cents per litre
-Diesel 0.05% (wholesale): A decrease of 17 cents per litre
-Diesel 0.005% (wholesale): A decrease of 22 cents per litre
-Illuminating paraffin: A decrease of 6 cents per litre
Currently, petrol prices stand at R21.62 per litre at the coast and R22.45 inland for 95 unleaded, while 93 unleaded petrol is priced at R22.16 per litre.
The primary drivers of these adjustments are the recent decline in global oil prices and a softer US dollar.
These factors have contributed to an improved outlook for March’s fuel prices, particularly following the mid-month spike in over-recovery due to the weaker dollar and lower-than-expected global demand for oil.
The weaker dollar played a key role in the reduction of fuel costs, as it enabled more favorable exchange rates. Meanwhile, global oil prices have been trending downward.
This week, Brent Crude oil prices fell to near three-month lows, dipping below $72 per barrel on February 26, driven by an unexpected increase in US fuel stockpiles, which was linked to lower demand, and speculation about a potential peace deal between Russia and Ukraine.
A resolution in the region could lead to sanctions being lifted on Russian oil, further contributing to global supply adjustments.
As of the latest data, Brent Crude is trading at $72.81 per barrel.
South Africa’s rand remained relatively stable on Friday, trading at R18.46 against the dollar. Despite this stability, the currency has experienced volatility in recent weeks, influenced by local budgetary disputes and uncertainty surrounding the policies of the U.S. Federal Reserve, Reuters reported.
Economists are closely monitoring the economic landscape, with recent data revealing that South Africa’s trade deficit widened to R16.42 billion in January, while the budget deficit stood at R62.68 billion for the same period.
Additionally, figures from the South African Reserve Bank show that M3 money supply growth increased to 7.10% in January, and credit growth for the month rose to 4.59%.
These developments signal a complex mix of global and domestic factors impacting the local fuel price dynamics, but for now, South African drivers can breathe a sigh of relief as they prepare for lower fuel costs in March.
