A combination of falling oil prices and a surprise rally in the rand may ease the financial pressure on motorists at the pump in the first week of November.

The latest data from the Central Energy Fund shows that petrol prices could be cut by between 3c a litre(95 unleaded) to 15c (93), while diesel prices could be lowered by between 9c and 11c, and illuminating paraffin by 17c.

After briefly spiking to reach almost $70 a barrel after a shock drone attack on a major Saudi oil plant a month ago, Brent crude oil is currently trading around $59.30 a barrel. This is almost a fifth lower than six months ago, as global markets fret about the impact of the trade war between the US and China on global growth and the demand for oil.

At R14.67/$, the rand is currently trading around its strongest level in more than a month, after almost hitting R15.30 barely two weeks ago.

Andre Botha, senior dealer at TreasuryONE, says the currency is being boosted by global investors looking for yield. Over the past four days, foreigners have been net buyers of more than R6bn in South African government bonds. 

SA government bonds are currently offering fat yields compared to other global bonds – especially those in Europe, where negative yields (investors are effectively paying governments for the privilege of lending them money) are becoming more common.

Botha says that Parliament’s vote on Tuesday to extend R59bn to Eskom also seemed to boost the rand overnight.

The official fuel announcement will be made in late October or early November.