By Jason Woosey - IOL

November’s petrol and diesel price cuts could be followed by more fuel price relief in December 2023 if current oil price trends continue to the end of this month.

Those with diesel powered vehicles are likely to cheer the loudest next month, with the latest daily snapshot from the Central Energy Fund pointing to potential price cuts of around R1.80 per litre.

Petrol is looking harder to predict at this stage, due to a wide variance between early-month and current data, but the eventual price reduction could fall somewhere between 60 cents and R1, should current trends persist.

Although it’s too early to predict next month’s price adjustments with certainty, a substantial diesel price drop of almost R2 would be welcomed on many fronts, especially since the associated transport costs also have an impact on general inflation.

However that must also be seen in the context that diesel is still very expensive in historical terms, with South African prices having risen by R5.40 in the three months between August and October, before dropping by 85 cents in November.

The wholesale price of 500ppm diesel is currently listed at R23.44 at the coast and R24.16 inland, while 50ppm is pegged at R23.69 and R24.40 in the respective zones. But you’ll need to add at least R2 to arrive at the retail prices which vary between outlets.

95 Unleaded petrol currently costs R23.18 at the coast and R23.90 inland, where 93 Unleaded retails at R23.44.

Oil prices staying put, so far

A stronger currency and lower oil prices are currently contributing to an over-recovery in petrol and diesel prices.

At the time of writing, on November 07, Brent Crude oil was trading at around the $85 mark, which is lower than last month’s average of $88.7 which determined the current prices. The rand was trading at a favourable R18.36.

The December fuel price cuts predicted above are by no means set in stone as much can still change on the currency and oil price fronts between now and the end of November.