February could see more fuel price relief, but oil prices remain a risk
Petrol and diesel prices could fall again in February.
Image: David Ritchie / Independent Media
South Africa’s petrol and diesel prices hit four-year lows following January’s significant reductions; however, fuel costs could creep even lower in February.
Mid-month data from the Central Energy Fund shows strong over-recoveries for both petrol and diesel. But this comes with a big caveat.
As it stands, the current month averages are pointing to petrol price decreases of around 85 cents and a diesel reduction of just over R1. However, the latest daily figures, showing over-recoveries of around 40 cents for petrol and 30 cents for diesel, imply that these projected decreases could be significantly eroded by month-end.
Working in our favour is a strong South African rand, which has put on a stellar performance during the first two weeks of January, surging to its highest level against the US dollar since 2022.
However, a recent surge in international oil prices is counteracting the local currency. Brent Crude oil hit the US$65 mark this week, which is significantly higher than its average of $61.47 during the previous review period that determined the current fuel prices.
Concerns about potential supply disruptions in the Middle East, particularly with instability in Iran, continue to support higher oil prices, Reuters reported. Iran is believed to be the world’s sixth-largest oil producer.
Cheapest fuel in four years
South African fuel prices are currently at their lowest level since February 2022.
Earlier this month, the Department of Mineral and Petroleum Resources confirmed petrol price decreases of between 62 cents per litre for 93 Unleaded and 66 cents for 95 Unleaded, while diesel saw price cuts of R1.37 for 500ppm and R1.50 for 50ppm.
A litre of 95 Unleaded currently costs R19.92 at the coast, while those in the inland regions are paying around R20.75 for 95 ULP and R20.64 for 93 ULP.
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