The expected Petrol Price changes in September 2024
Data from the Central Energy Fund (CEF) in the middle of the month indicates a significant reduction in petrol and diesel prices expected in September.
According to the CEF data, petrol prices will drop by around 65 cents per litre. Diesel prices, on the other hand, are expected to decrease by between 53 and 77 cents per litre.
If market conditions stay the same until the end of the month, it would be the fifth month of lower fuel prices. This would mean that overall, motorists have saved money on fuel this year.
These are the expected changes:
- Petrol 93: decrease of 62 cents per litre
- Petrol 95: decrease of 67 cents per litre
- Diesel 0.05% (wholesale): decrease of 53 cents per litre
- Diesel 0.005% (wholesale): decrease of 77 cents per litre
- Illuminating paraffin: decrease of 78 cents per litre
The CEF does not present daily snapshot data for LP Gas.
The DMRE's daily snapshots cannot predict future changes. They may also not include all possible adjustments, such as slate levy changes or retail margin adjustments.
These modifications are decided by the department, taking into account multiple elements, at the month's conclusion.
The cost of household fuel is mainly determined by the rand/dollar exchange rate and global oil prices. In South Africa, these two elements influence the adjustment of fuel prices on the first Wednesday of each month.
In September, the cost of oil has decreased compared to July, while the rand has experienced a minor depreciation, undermining the over-recovery.
Current Oil prices
Oil prices are once more trading below $80 per barrel, which bodes well for domestic fuel costs.
The market has experienced instability in the past few weeks following the market fright in early August, when concerns about a potential recession in the United States emerged prominently.
Strains in the Middle East and a deceleration in the Chinese market—which is the largest oil consumer—have also been maintaining price stability.
In recent sessions, pricing has stabilized due to fears of a possible Iranian assault on Israel, which overshadowed negative data from China indicating a drop in crude oil usage.
Bloomberg analysis indicates that oil prices have decreased since July. This is because there is less demand in China. Cleaner fuels are gaining popularity in the country.
OPEC reduced its global demand prediction for 2024 in a recent report. OPEC lowered its global demand forecast for 2024 in a recent report. At the same time, the International Energy Agency warned that there might be too much supply in the market next quarter. This could happen if OPEC goes ahead with its plan to boost production.
Brent crude oil is priced around $80 a barrel, down 3.1% in the last two days. Brent crude oil costs about $80 a barrel. It has dropped 3.1% in the last two days. Tensions are increasing because Iran has vowed to respond to the killing of a Hamas leader. People are curious about how Iran will retaliate.
In July, China's oil demand dropped by 8% compared to last year, according to government data. This worsens the negative outlook for Asia's largest economy.
Oil prices are causing local prices to be 58-82 cents per liter higher than international petroleum costs.
The Rand/Dollar situation
The rand has also had a turbulent couple of weeks in August.
The local entity mirrored other developing markets during the initial market turmoil at the beginning of the month. However, it was salvaged by the now-continuous optimistic change in perception towards the Government of National Unity (GNU) and anticipated reforms.
Investec's chief economist, Annabel Bishop, anticipates that the rand will maintain its volatility due to the impending commencement of the interest rate reduction cycle.
The US Fed is likely to lower rates starting in September, which could strengthen the rand. The US Fed may lower rates in September, potentially boosting the rand. However, the South African Reserve Bank is also expected to lower rates around the same time. This could prevent the rand from strengthening too much.
The rand is expected to keep rising due to positive market sentiment.
The exchange rate is now R18 to the dollar, which is better than the R18.60/$ rate during the market panic. But it is still lower than in July when it was below R18.00 due to the positive election results and government setup for 2024.
The weaker rand since July is leading to a 5 cents per litre loss in local prices.
This is how changes in price will show at gas stations (Diesel prices reflect wholesale, pump prices may vary).
Inland August Official vs September Expected
93 Petrol - R22.71 decrease to R22.0995
Petrol - R23.11 decrease to R22.44
Diesel 0.05% (wholesale) - R20.38 decrease to R19.85
Diesel 0.005% (wholesale) - R20.74 decrease to R19.97
Illuminating Paraffin - R14.80 decrease to R14.02
Coastal August Official vs September Expected
93 Petrol - R21.92 decrease to R21.3095
Petrol - R22.32 decrease to R21.65
Diesel 0.05% (wholesale) - R19.59 decrease to R19.06
Diesel 0.005% (wholesale) - R19.98 decrease to R19.21
Illuminating Paraffin R13.80 R13.02
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