Petrol Price Drop Expected Next Week – Good News for Motorists
South African motorists are set to breathe a sigh of relief as petrol and diesel prices are expected to fall next week. The latest data from the Central Energy Fund (CEF) for the third week of August indicates that favourable exchange rates have helped. Declining global oil prices have also created an over-recovery, paving the way for lower fuel costs.
Modest Petrol Cuts, Bigger Diesel Relief
Projections show a small reduction in petrol prices. Petrol 93 will drop by 14 cents per litre and Petrol 95 will decrease by 6 cents per litre. Diesel, on the other hand, will enjoy a more significant price relief. Wholesale Diesel 0.05% is set to fall by 51 cents per litre and Diesel 0.005% by 52 cents per litre.
This turnaround is a stark contrast to the beginning of the month. At that time, a weaker Rand against the US Dollar drove fuel prices up, placing extra pressure on South African drivers.
Expected Petrol Price Changes Next Week
| Fuel Type | Expected Price Change |
|---|---|
| Petrol 93 | -14 cents per litre |
| Petrol 95 | -6 cents per litre |
| Diesel 0.05% (wholesale) | -51 cents per litre |
| Diesel 0.005% (wholesale) | -52 cents per litre |
Global Oil Prices and Trade Tensions
The key driver behind this reversal is a dip in global oil prices. Oil has fallen roughly 10% this year, with August prices lower than those seen in July. Market analysts, including Bloomberg, note that prices have remained steady amid uncertainty over Russian crude sales to India.
Former US trade adviser Peter Navarro has criticised India’s ongoing purchases of Russian oil. He warns that US import levies could double. Meanwhile, former President Trump has threatened to raise duties on Indian imports to the US to 50%, partly due to the same oil trade.
These disputes, combined with OPEC+ increasing production, have contributed to a bearish market outlook. Global demand appears to be softening. Significant inventory builds are also expected in the coming months, keeping oil prices relatively low.
Rand Stability Boosts Outlook
Local currency trends have also played a role. The Rand showed surprising resilience in August, trading within a tight range. This was despite global and domestic pressures, including higher inflation reports from Stats SA.
According to Nedbank, investor caution ahead of the US Federal Reserve’s Jackson Hole symposium contributed to the Dollar’s strength.
“The dollar strengthened across the board after the minutes from the Federal Open Market Committee’s July meeting, which suggested that the committee remains cautious,” Nedbank said. “This fuelled expectations that the Federal Reserve might maintain higher interest rates for longer.”
This relative stability of the Rand has helped offset fuel price pressures. It added a modest 0.3 cents per litre to the over-recovery. In contrast, the start of August saw the currency’s weakness contributing negatively by roughly 20 cents per litre.
A Welcome Relief for South African Drivers
For consumers, the coming price adjustments offer some respite amid rising living costs. While petrol reductions are relatively small, the significant drop in diesel prices will be particularly welcomed. Commercial transport operators, truck drivers, and industries reliant on fuel will benefit the most.
With both global and local factors aligning to ease fuel costs, motorists can expect some relief at the pumps in the coming week. This is a welcome reprieve after a challenging start to the month.
Related article: South Africans to See More Relief as Petrol Prices Expected to Drop Again in September
