The CEF does not present daily snapshot data for LP Gas.<\/p>\n\n\n\n
The Department of Mineral Resources and Energy (DMRE) has noted that its daily snapshots are not predictive and do not encompass other possible modifications, such as slate levy adjustments or retail margin changes. <\/p>\n\n\n\n
The department determines these adjustments, considering various factors, at the end of the month.<\/p>\n\n\n\n
Domestic fuel costs are primarily governed by the rand\/dollar exchange rate and international oil prices. In South Africa, the fuel price is adjusted on the first Wednesday of every month based on these two factors.<\/p>\n\n\n\n
For October’s changes, oil prices in September have been lower relative to August, while the rand has been stronger overall, boosting recoveries.<\/p>\n\n\n\n
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Oil prices<\/strong><\/p>\n\n\n\n The main driver of the over-recovery of local fuel prices is the lower global oil price, which is contributing the bulk (98-117 cents per litre) to the benefit towards motorists.<\/p>\n\n\n\n After hitting over $85 a barrel in the past few months, global oil has now steadied around $72 a barrel.<\/p>\n\n\n\n Pricing has come under pressure as the balance between supply and demand has been shaky.<\/p>\n\n\n\n While supplies have been hit by drops in exports and artificial cuts by oil-producing nations, the global market remains well-stocked.<\/p>\n\n\n\n Meanwhile, the demand side has been weaker due to an economic slump in China, which is deepening.<\/p>\n\n\n\n According to Bloomberg’s analysis of the market, Chinese data released over the weekend showed industrial output in the longest losing streak since 2021 and investment falling more than expected. The official economic growth goal of 5% for this year looks increasingly out of reach. <\/p>\n\n\n\n “The worsening situation in the number-one crude importer\u2014along with an increase in global supply\u2014have pushed Brent down by around 17% this quarter to near the lowest since late 2021,” it said.<\/p>\n\n\n\n Rand\/dollar<\/strong><\/p>\n\n\n\n While the rand has weakened against the dollar in recent sessions, its overall stronger position compared to a month ago makes it a positive contributor towards fuel price recoveries (around 11 cents per litre).<\/p>\n\n\n\n The rand ended last week on a firmer note as markets weighed up bets on the size of a rate cut expected in the US this week.<\/p>\n\n\n\n It closed around R17.73 against the dollar\u2014about 0.2% firmer than its Thursday closing level\u2014as the dollar traded softer against a basket of peers.<\/p>\n\n\n\n Looking beyond the daily volatility in trades, however, the rand has been in a generally stronger position overall in the past month thanks to positive sentiment around the Government of National Unity (GNU) and the promise of positive reforms.<\/p>\n\n\n\n However, this does not take out the risk factors baked into South Africa’s finamental issues, nor volatility seen around global moves.<\/p>\n\n\n\n According to Citadel Global director Bianca Botes, this week will almost certainly bring turbulence, with both the US Fed and the SARB under close watch as they deliver their interest rate decisions. <\/p>\n\n\n\n “Investors will take a particular interest in the size of the cut by the Fed and any forward guidance central bank officials might offer,” Botes said.<\/p>\n\n\n\n The rand benefitted from a softer dollar to trade to the stronger end of its recent range, and starts the week at R17.67\/$, R19.62\/\u20ac and R23.26\/\u00a3.<\/p>\n\n\n\n![\"\"](\"https:\/\/businesstech.co.za\/news\/wp-content\/uploads\/2024\/09\/Product-prices-mid-sept.jpg\")
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