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Tuesday, July 23, 2024

Fuel prices drop confirmed for August

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The Department of Mineral Resources and Energy (DMRE) has confirmed that fuel prices will drop in August.

The announcement comes on the back of a reduction in international oil prices.

By the close of business on Thursday 28 July, the price of Brent Crude oil was hovering around 101 US dollars per barrel, a reduction on average of about 10% compared to the average price for June 2022.

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The DMRE has welcomed the relief of international petroleum product prices, including crude oil prices, which is expected to bring some relief to motorists.

“Government has for the past four months cushioned South Africans from the vagaries of the oil market and the full impact of the high international oil prices.”

Officials introduced a temporary reduction in the general fuel levy of R1.50 per litre from 06 April to 05 July.

Read also: New tyre import duty will collapse already struggling transport companies – RFA

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This reduction was amended to 75c per litre from 06 July 2022 to 02 August 2022.

The DMRE says even though the reduction of the fuel levy falls away in August, motorists will still benefit from lower petrol prices.

“Despite this reprieve coming to an end on 02 August 2022, the Department can confirm that there will still be a sizeable reduction in fuel prices, including paraffin for South Africans. A formal announcement in this regard will be made by the end of the week.”

Earlier this month, the DMRE officially started the process of deregulating the price of 93 octane petrol in South Africa.

Mineral Resources Minister Gwede Mantashe said this price cap would allow for the fuel suppliers who can pass the benefit to the consumer to do so.

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“No disruptions are expected in the fuel market as 93 Octane accounts for a small portion of the market; however, this will allow the department to monitor how the market will react to the capping of the price.”

The news might provide some relief to cash-strapped and struggling motorists and commuters after two massive petrol price hikes in June and July.

According to the Automobile Association (AA), fuel prices for August could be reduced by R1.07 per litre for 93 octane, 90 cents per litre 95 octane, while diesel could drop by around 91 cents per litre and illuminating paraffin by about 94 cents per litre.

However, the AA warned the reduction in fuel prices is subject to change ahead of the announcement by the DMRE.

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