As global oil prices trend lower, South African motorists can breathe a small sigh of relief. Although local fuel prices are linked to the rand/dollar exchange rate and the cost of oil, the projected hike of around eight cents per liter is lower than the previously predicted 56 cents per liter hike at the start of the month.
Rand had been a significant thorn in the side of petrol and diesel
For much of March, the rand has been the biggest problem for gasoline and diesel, causing prices to drop by about 40 cents per liter. But the revisions in prices now show that petrol and diesel prices in the area are too high by 30 and 80 cents per liter. As a result, diesel prices will decrease by 22 cents per liter, but gasoline prices will increase by 25 cents per liter.
Impact of market volatility
The failure of big banks in the US and Europe has had a significant effect on the markets, impacting both the price of oil and the exchange rate. But there is still a lot of time for things to change, as the next month doesn’t start for another two weeks.
No fuel tax hikes
The Central Energy Fund’s data from the middle of the month showed that the price of paraffin went down by 68 cents per liter. So, at least, drivers can be glad that fuel taxes won’t increase in the new month. However, with the anticipation that oil prices will keep going down, local gasoline and diesel costs may increase during the next few weeks.
South African motorists can look forward to a slight decrease in diesel prices in April, with petrol prices increasing by a smaller amount than previously predicted. While market volatility and exchange rates can still impact prices, at least there are no additional fuel tax hikes to add to motorists’ woes.