Petrol price relief expected in June thanks to the stronger rand

Motorists can expect some relief at the pumps in June due to a decline in the crude oil price, and a resurgent rand.

The latest data from the Department of Energy shows that the price of gasoline 93 (ULP & LRP) in Gauteng could drop by as much as 24.4 cents per litre, while the price of diesel with a 0.005% sulphur content could decrease by 19.2 cents per litre.

According to independent economist, Fanie Brink, the picture could have been a whole lot better, with crude oil up to about $54 a barrel on Wednesday, from $48 per barrel at the beginning of the month.

Brink said that the price has risen in anticipation of an extension of the agreement between the largest oil producing countries to further reduce their production.

Organisation of Petroleum Exporting Countries (OPEC) is expected to extend its production cuts for another nine months so as to bring the oil market back into balance.

Despite this rise in the crude oil price, the average petroleum products prices were still lower this month than in April, Brink said, and could result in a 17 cents per litre decrease in the gasoline price and 11.9 cents per litre in the diesel price.

The strengthening in the exchange rate to below R13 against the US dollar meanwhile, could lead to a of 7.4 cents per litre reduction in the gasoline price and 7.3 cents per litre in the diesel price in June.

The final price changes will be announced by the Minister of Energy at the end of the month, and will come into effect on Wednesday, 7 June 2017.

Here’s what you can expect to pay in June, based on current inland prices.

Fuel May official June predicted
93 Petrol R13.57 R13.33 (-0.24)
95 Petrol R13.79 R13.60 (-0.19)
0.05% Diesel (wholesale) R11.81 R11.61 (-0.20)

Read: Here is the official petrol price for May 2017

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Petrol price relief expected in June thanks to the stronger rand