Petrol price joy for South Africa in January
The latest data from the Central Energy Fund (CEF) at the end of the fourth week of December shows that motorists are in store for an even bigger cut in prices in the new year.
After starting the month in the negatives, petrol price recoveries swung firmly into positive territory and have continued on this trajectory.
Petrol prices have added another 15 cents to recoveries over the past week, taking the expected cut to between 46 and 51 cents per litre.
Diesel prices are faring even better, with the diesel price over-recovery pushing to 124 cents and 136 cents per litre.
These are the expected price changes at the end of week 4:
- Petrol 93: decrease of 46 cents per litre
- Petrol 95: decrease of 51 cents per litre
- Diesel 0.05% (wholesale): decrease of 124 cents per litre
- Diesel 0.005% (wholesale): decrease of 136 cents per litre
- Illuminating paraffin: decrease of 85 cents per litre
With one more week left, bleeding into early January 2026, a petrol and diesel price cut is all but guaranteed at this stage.
The large shift in recoveries is thanks to both a stronger rand and a weaker oil price, with both factors benefiting local motorists.
December is characterised by low market activity, as much of the country and the world takes a break to celebrate the end-of-year holidays.
However, the limited activity that has occurred has been positive overall.
Ahead of the Christmas and Day of Goodwill break, the rand strengthened against the US dollar amid a gold price and commodity rally.
The currency edged up against the dollar, extending the week’s gains as investors continued to pile into precious metals.
On Friday, the rand was at R16.65 per dollar.
“The rand appears to be ending 2025 on the front foot. With the dollar still on the defensive and commodity prices rising to help sustain South Africa’s trade balance in surplus territory, there is solid justification for the rand’s impressive performance,” ETM Analytics said in a note.
The rand is on course for gains of more than 12% against the dollar this year, bolstered by South Africa’s improved fiscal performance and success in containing inflation as well as soaring prices of precious metals like gold and platinum, which are major exports.
United States targets oil
Contrary to last week’s analysis, the global oil price has since reversed course and is back trading above $60 a barrel, hitting over $62 before Christmas.
This puts oil on track for its biggest weekly gain since late October, up 3% this week.
According to Bloomberg’s analysis of the markets, the hike came as traders tracked a partial US blockade of crude shipments from Venezuela and a military strike by Washington against a militant group in Nigeria.
The Trump administration has been targeting Venezuelan oil, allegedly taking on drug cartels, and applying pressure on the country’s government.
The US has ordered a naval blockade of all sanctioned oil tankers entering and leaving Venezuela for the next two months, according to a person familiar with the matter.
The person, who requested anonymity, said US forces were focused almost exclusively on the blockade, rather than military options.
In Africa, President Donald Trump said that the US launched a “powerful and deadly strike” against Islamic State targets in Northwest Nigeria, according to a social-media post. The country, an OPEC member, produced about 1.5 million barrels a day in November, according to data from the cartel.
US Defence Secretary Pete Hegseth threatened there would be “more to come” if the Islamic State did not stop going after “innocent Christians in Nigeria (and elsewhere)”.
The White House did not respond to a request for more details on the strike, including those impacted or the weaponry used.
Despite the recent rally and volatility in pricing, Brent crude remains on track for the biggest annual decline since 2020 after slumping 16%.
The drop has been driven by expectations for a surplus, with virtually all of the world’s major crude traders foreseeing a global glut next year after producers in and outside OPEC+ increased supplies.
Still, the intensifying geopolitical flare-ups have helped keep a floor under prices, Bloomberg noted.
Petrol price changes will take effect on the first Wednesday in the new year (7 January), with the Department of Petroleum and Mineral Resources announcing the official changes before then.
With Reuters and Bloomberg
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