Petrol price cut coming this week
In November, oil prices remained stable. As a result, South African drivers can expect a decrease in petrol and diesel prices this week.
The government will tell us about changes to fuel prices before they happen on Wednesday, 6 December. The current data suggests that they will reduce both petrol and diesel prices.
The CEF predicts that petrol prices will decrease by about R1.00 per litre. Diesel prices, on the other hand, will decrease by a larger amount. The decrease for diesel will be between R2.22 and R2.28 per litre.
The rand has been strong in November, causing fuel prices to decrease by 32-38 cents per litre. In November, the rand has been strong, resulting in a decrease in fuel prices by 32-38 cents per litre. The majority of the savings, however, are due to lower international product prices. For petrol, this contributes 66 cents per litre, while for diesel, it contributes R1.90 per litre.
South African drivers may soon pay R22.90 for 95 grade petrol and around R20 for diesel during the holiday season. This is good news for those planning to travel to vacation spots.
The rand has been very unstable lately, trading between R18.10 and R19.00 to the dollar. On average, it has been around R18.50 to the dollar in November.
This is much lower than the R19.10 average seen in October, hence its positive contribution to the over-recovery.
But as the nervousness decreased in November, prices dropped and even went below $80 per barrel at one point.
Overall, international product prices have also trended much lower than the levels seen in October. There is still some uncertainty in the market, but it is unlikely to affect December's pricing at this point in November.
Global benchmark Brent rose above $82 a barrel, increasing by over 2% earlier this week, as per Bloomberg analyzed.
Prices rose as markets anticipated that the US Fed has completed its policy tightening and may reduce borrowing costs next year. The recent decline in the dollar also helped boost prices.
The price move caused oil to break out of a holding pattern ahead of an OPEC+ meeting scheduled for Thursday (30 November).
The producer group will have an online meeting to decide on policies for 2024. However, they still need to solve a disagreement about output quotas for certain African members.
Oil is likely to decrease for the second month in a row because of more supply from non-OPEC+ countries. This will put more pressure on the cartel and its allies to make bigger cuts in production, according to Bloomberg.
Economists and analysts expect petrol prices to decrease in December. This should help reduce inflation and ease concerns about possible interest rate increases next year.
The rise in petrol prices in September and October caused inflation to increase. This increase in inflation led to concerns that the South African Reserve Bank would raise interest rates in November.
The bank decided to keep rates the same because they believe inflation will decrease and stay within the target range.
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