The Department of Energy has announced that the price of all grades of petrol will drop by 25 cents, while the price of diesel will decrease by 23 cents.
The new prices will kick in on Wednesday.
The price decreases are as follows:
- Petrol (95 Octane, ULP and LRP): 25 cents per litre (c/l);
- Petrol (93 Octane, ULP and LRP): 25 c/l;
- Diesel (0.05% sulphur): 23 c/l;
- Diesel (0.005% sulphur): 23 c/l;
- Illuminating Paraffin [IP] (wholesale): 22 c/l;
- SMNRP [Single Maximum National Retail Price] for IP: 30 c/l, and
- Maximum LPGas Retail Price: 77 c/kg.
South Africa’s fuel prices are adjusted on a monthly basis, informed by international and local factors. International factors include the fact that South Africa imports both crude oil and finished products at a price set at the international level, including shipping costs.
The main reasons for the fuel price adjustments in June 2017 are the strengthening of the Rand against the US Dollar during the period under review and the average decrease in the prices of petroleum products in the international markets in line with the lower crude oil prices.
“Oil prices declined after data showed an increase in US crude inventories, fuelling concerns that markets remained oversupplied, despite efforts by top producers Saudi Arabia and Russia to cut output,” the Department of Energy said in a statement.
Furthermore, the Organisation of Oil Producers and Exporting Countries (OPEC) and some non-OPEC producers agreed to extend supply cuts of 1.8 million barrels per day until the end of March 2018 at a meeting in Vienna on 25 May 2017.
While OPEC’s decision was expected, some oil market investors had hoped that the oil producers would agree to longer or deeper cuts to drain the global glut of crude supplies.
The fuel pricing schedule for the different zones will be published on Tuesday.