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Big petrol price drop expected in December

Big petrol price drop expected in December

The petrol price could decrease by more than 70 cents a litre and the wholesale price of diesel could fall by about 50 cents on 3 December, the Solidarity Research Institute (SRI) said on Tuesday (18 November).

With the expected decrease, the price of petrol will be lower than it was a year ago. It will be the first time in five years that petrol is cheaper on an annual basis, the trade union said.

It follows a 45 cents per litre cut on 5 November.

Paul Joubert, senior economic researcher at the SRI, said that the weaker rand is counteracting a reduction in local fuel prices at present.

He said the rand traded at an average of approximately R11.12 against the US dollar in October. So far, it has traded marginally weaker at an average of R11.14 during November.

“Fortunately, international petroleum product prices, the other factor that determines local fuel prices, have so far continued to decline along with oil prices during the course of November,” Joubert said.

The price of Opec oil, which was $86.29 a barrel in October, has averaged nearly 10% lower at $77.67 a barrel in November so far, he added.

The expected reduction would take the price of 93 octane petrol in Gauteng to approximately R12.28 a litre, which is below the price of R12.97 a litre that applied in December 2013.

“In November 2009, petrol was R1.30 cheaper than in November 2008, but in the subsequent five years the price of petrol has consistently been higher than it was a year before,” said Joubert.

Joubert said the relevant period for calculating December’s local fuel prices only ends on Thursday, 27 November.

He indicated that, should the rand or oil prices experience large fluctuations between now and then, the fuel price adjustments in December could deviate significantly from this projection.

The Department of Energy will announce the final fuel price changes on 28 November.

More on the petrol price

South Africans pay the most for petrol

Petrol price to decrease by 45 cents

 


BusinessTech's Staff Writer is directly plugged into the South African Internet backbone, and spits out press releases and other news as they receive it. They are believed to be cl...
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  • Alain Craven

    Yay – now everything that went up as a result of fuel prices will come down!!

    /sarcasm

    • Anamech

      In a perfect world…YES…BUT TIA!!!! :/

  • McTSA

    If nothing else, it is good news for the holiday season.

  • Thinus

    Petrol goes down goods and services stay were they are…

    • one gear, GO!

      Very true! But for a entrepreneur owning his own business helps quite alot, with vehicles pretol as well

  • Wurnman

    Good news, i just wished food prices would follow BUT seems they only go up with petrol prices, not down.

  • tongue in cheek

    Maybe I can’t do maths but how come a 25%-30% decrease of $ oil price, doesn’t reflect a similar percentage at the pumps- despite all the taxes that are levied all things being equal .

    • fanus

      I’m hoping the government is building a buffer with the monthly over collection going on. Instead of doing a R5 drop they do it 50c at a time and stash the remaining R4.50 into the buffer. When the crude price rise and the rand goes to hell then we’ll have the same 50c increases over a year or so rather than a R5 jump in one month. Who’s with me? I’m sure that is what our government is doing with the billions we are over paying.

      • Gerrit Kellerman

        They do exactly what you suggest, except they steal all the money, and when the crude oil prices go up, there is no buffer left.

      • tongue in cheek

        Yeah, I have a shrewd suspicion Gerrit is correct, but your idea is a good one, if we didn’t have light fingered people “managing” the money. the other issue is the abnormally destitute Rand, when is that going to do something positive

  • The stiggy

    can finally use that A/C button……

  • VaMutuki

    Meanwhile everything else will go up since it’s December.

  • Snakes

    Yay Petrol drop to help us prepare for all the hikes in 2015. Don’t use see the pattern. Every here it drops in December. Since everyone is on holiday they spending more anyways on fuel so in the end of the day the government is gaining. Then come back January there is more petrol hikes vs the 2c drops

  • Iphone5S

    Why cant the Rand gain against the Dollar and EURO like Ghana’s currency?

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