Ricochet News

Dept of Energy confirms slight petrol price decreases for March 2017

FEBRUARY 25, 2017
Dept of Energy confirms slight petrol price decreases for March 2017

The retail price of both 93 and 95 octane petrol will decrease by 8c a litre on Wednesday, while the price of diesel will also decrease by 2c a litre and the wholesale price of illuminating paraffin will decrease by 8c a litre, the Department of Energy has confirmed. 

LP gas will cost 2c less  per kilogram.

According to the Department, the main reasons for the fuel price adjustments are due to:

The contribution of the Rand/US Dollar exchange rate - The Rand strengthened against the US Dollar from R13.60 to R13.30, on average, during the period under review when compared to the previous one. This contributed by about 13 cents per litre to the fuel price changes for March 2017

The increase in the prices crude oil - The prices crude oil increased, on average, during the period under review. Some of the factors that contributed to crude oil increase were; (a) the strained relationship between Tehran and the United States that raised concerns that US sanctions could be tightened further to impact Iranian oil exports, which were only allowed to return to normal last year, and (b) the fact that OPEC members have reportedly achieved a high level of compliance with the production cuts announced in November last year.

The average increase in the international prices of all petroleum products. The prices of petrol, diesel and illuminating paraffin increased, on average, in the international markets during the period under review. The Basic Fuel Price (BFP) of all the products increased in line with the price of crude oil. Exports from China of petrol and diesel, the region’s largest petroleum user, are also down due to good domestic buying before the 7 day Chinese New Year holidays.

The fuel prices schedule for the different zones will be published on Tuesday, the Department said.

On Friday, however, the Automobile Association of South Africa (AA) warned that these slight decreases won’t mean much for South African consumers after the fuel and Road Accident Fund levy increases that were announced by Finance Minister, Pravin Gordhan, in his 2017 National Budget Speech.

The tax adjustments announced by Minister Gordhan mean that the April 2017 fuel levy goes up by 30 cents per litre, while the RAF levy will go up by a further 9 cents, adding 39 cents to both petrol and diesel prices.

"It would take quite a substantial effort from both the Rand and oil prices to offset the tax hikes and prevent higher fuel prices in April," the AA said.