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Slight drop in May fuel prices

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A slight drop in the petrol price in May is expected to bring much-needed relief to motorists’ pockets. A litre of 95 and 93 octane petrol is expected to cost around 9 cents less while the price of diesel will drop by 30c and paraffin 23c.

The price decrease is due to the slight appreciation of the rand, the Mineral Resources and Energy Department says.

Mancosa senior finance and economics lecturer Meshel Muzuva warned that consumers must be aware that there would always be the instability of local and global economies which could affect fuel prices.

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He said international petroleum prices had been stable, allowing the rand to leverage its recent strength. That had led to a lower contribution to the basic fuel prices on petrol, diesel and illuminating paraffin.

“The fuel price decrease will bring some relief to cash-strapped South Africans. Financially burdened South African consumers can thus expect a breather in May from the series of fuel price increases earlier in the year. Users of paraffin will be delighted with the news as we are approaching cold winter months,” he said.

Muzuva said the impact of the decrease in the price of paraffin would result in poorer households witnessing a decrease in their cost of living.

Consumers would also benefit from the lower prices of transport and fuel as it would increase their disposable income, enabling them to spend more on other goods.

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“Nevertheless, consumers should continue to be worried, given the ongoing instability in both local and global economies which may point to future uncertainty around petrol prices in the coming months.

“Global financial markets do impact the rand, so the weakening of the rand in future could push the fuel price further to unsustainable levels and bite the little income at the disposal of households,” Muzuva said. – IOL

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