The Department of Energy recently published the adjustments to the fuel prices that will come into effect this Wednesday the 4th of March 2020.
The department announced that South African vehicle owners will be paying 19 cents less per liter at petrol stations tomorrow morning to fill up their tanks, diesel users will see prices drop by 54 cents per liter.
The fuel price drops are due to the lower cost of international petroleum products. These were also significantly impacted by oil price weakness on the back of a global market downturn which was due to the recent Coronavirus outbreak. There are, as could be, two main considerations at play. Be that as it may, it’s the worldwide oil value drifts that have represented this slicing of fuel costs. The flare-up of the coronavirus has left universal markets scared, and the interest in oil has subsided. The decline would have been more, notwithstanding the Rand’s frail month to month execution against the US dollar. Regardless of a short meeting this week, ZAR is as yet fumbling.
The average rand/US dollar exchange rate for the period ended January 2020 to 27 February 2020 was R14.98 compared to it being R14.33 in the previous period. The petrol price drop was undercut by the weaker rand which however depreciated against the US dollar during the period that was under review at the time.
All of this led to a higher contribution to the basic fuel prices on petrol, diesel and paraffin.
|Fuel (Inland)||February official||March Official|
|0.05% Diesel (wholesale)||R14.57||R14.03|
|0.005% Diesel (wholesale)||R14.62||R14.08|
While drivers will get a value drop in March, they should fight with fuel charge hikes in April. As a component of his 2020 spending speech, Finance Minister Tito Mboweni declared that fuel expenses will ascend by 25 cents for every liter come 1 April. This incorporates 16 cents for each liter increment to the general fuel demand, and a 9 cent for every liter increment to the Road Accident Fund Levy.
This will push up the general fuel demand from R3.61 per liter of petroleum, to R3.77 (a 4.4% expansion), while the RAF duty will bounce from R1.98 to R2.07 (a 4.5% expansion). For diesel drivers, the general duty increments from R3.47 to R3.63, and the RAF toll will likewise increment to R2.07.
By Noni Nchwe
Source: Business Tech