The Automotive Association (AA) said SA motorists would experience a historic drop of around R2 per liter in the price of fuel from the first April for unleaded petrol.
This year, oil prices plummeted as the result of the Saudi-Russia trade war, which more than compensated for a weaker rand, while oil demand also dropped as a result of the economic disruption of the Covid 19 virus.
Right now, the population of South Africa of 59 million might be a little relieved under the lockout of the Covid 19, but on Wednesday, drivers will see a historic drop in fuel prices. Ministry of Minerals and Resources Gwede Mantashe said in his statement on Friday that all grades of fuel will drop from April 1: petroleum, diesel, paraffin and LPG.
He noted that the rand depreciated against the US dollar from R14.97 to R18.26 on average during the period under review, compared to the previous one. This led to a higher contribution of between 40 and 46.62 cents per litre to the basic prices of petrol, diesel and illuminated paraffin.
The fuel price drops do not include a rise in the fuel levy by 16 cents, and the Road Injury fund is rising by 9 cents.
According to the Central Energy Fund, the retail price of petrol (both 93 ULP and LRP) will decrease by R1.76 per litre (176.00 c / l) in Gauteng (and inland provinces), while both 95 ULP and LRP will decrease by R1.88 per litre (188.00 c / l).
93 LRP and ULP oil will decline by R1.82 per liter in the coastal provinces, while 95 LRP & ULP oil will decrease by R1.94 per liter.
In Gauteng the wholesale price of diesel (0.05% sulfur) will fall by 133.70 cents per liter and at the shore by 139.80. Diesel (0.005 per cent sulphur) will decrease by 134.70 cents per litre in Gauteng and by 140.80 cents per litre on the coast.
Meanwhile, the retail price of LPG will see the country’s largest decline of 378,00 cents per kilogram. The significant decreases in fuel prices have occurred despite the depreciating range; as well as the annual budget-related increases in fuel levy (up 16 cents per litre) and the Road Accident Fund levy (up 9 cents) announced by Finance Minister Tito Mboweni in February. Traditionally, these levies increase will come into effect in April.
The massive drop in fuel prices is largely due to a record drop in global oil prices to around $35 per barrel on the back of the spat between Saudi Arabia and Russia’s oil heavyweights, as well as a decrease in demand due to the Covid-19 outbreak.
By Noni Nchwe