Petrol prices currently still look set for a small cut at the start of July. Diesel, however, may be hiked.
Based on the current oil and rand prices, the latest data from the Central Energy Fund shows that diesel prices may be increased by 10c to 15c a litre, depending on the grade. Petrol 95 and 93 unleaded may be lowered by 6c a litre and 15c, respectively.
However, there is still some time to go before the final prices are set. Fuel prices will only be adjusted on 5 July.
South African fuel prices are largely determined by international oil costs and the rand exchange rate, as oil is priced in dollars.
Brent crude oil has strengthened slightly since the beginning of the month, from $74 to $77 a barrel. But oil remains under pressure owing to a strong supply flow from Russia – as well as concerns about the Chinese economy, which is not rebounding as fast as expected.
After crashing to close to R20/$ last month amid continuing worries about South Africa’s close relationship with Russia, the rand has since recovered and is currently trading around R18.17/$.
At the beginning of June, the petrol price was cut by 71c a litre, while diesel was lowered by around 80c.
This brought the price of a litre of 95 unleaded petrol to R22.63 in Gauteng, compared to R24.17 a year before – and a record price of R26.74 in July last year.
The wholesale diesel price is currently R19.31 per litre in Gauteng. As recently as in November last year, diesel cost close to R25.50. Diesel is back to levels before the invasion of Ukraine caused a big spike in oil prices.