As December 2024 approaches, South African motorists are eagerly awaiting the latest fuel price adjustments. While petrol users can expect some relief, diesel users are facing potential increases.
The upcoming fuel price changes reflect a variety of economic factors, both local and international, that influence the cost of petroleum products in South Africa.
In this article, we will take a closer look at the expected petrol and diesel prices for December 2024, the factors that affect fuel prices, and what these changes mean for South African consumers.
Expected Petrol Price Changes for December 2024
The latest projections from the Central Energy Fund (CEF) indicate that petrol prices will decrease in December 2024, offering some much-needed relief for motorists.
However, diesel prices are expected to increase, which may impact businesses and consumers who rely on diesel-powered vehicles. Below is a summary of the expected price changes:
| Fuel Type | Expected Price Change |
|---|---|
| Petrol 93 Octane | Decrease of 16 cents |
| Petrol 95 Octane | Decrease of 4 cents |
| Diesel 0.05% Sulfur | Increase of 39 cents |
| Diesel 0.005% Sulfur | Increase of 38 cents |
| Illuminating Paraffin | Increase of 39 cents |
What Do These Changes Mean for Your Pocket?
For those who rely on petrol, the expected decrease in prices will likely bring some relief. Petrol 93 octane is projected to decrease by 16 cents per litre, while petrol 95 octane is expected to drop by 4 cents per litre. These price reductions will likely offer some relief to motorists who have been dealing with rising fuel costs over the past months.
On the other hand, diesel users may face an increase in their fuel costs. Diesel 0.05% Sulfur and 0.005% Sulfur are expected to increase by 39 cents and 38 cents per litre, respectively.
This increase in diesel prices could affect businesses in the logistics and agriculture sectors, as these industries rely heavily on diesel-powered vehicles and machinery.
Additionally, illuminating paraffin prices are expected to rise by 39 cents per litre, which could impact households that use paraffin as an alternative source of energy for cooking or heating.
Factors Influencing Fuel Prices in South Africa
Several factors influence fuel prices in South Africa, the most significant of which are international oil prices and the rand/dollar exchange rate.
International Oil Prices
The price of crude oil is a major determinant of fuel costs in South Africa. The price of Brent crude oil, the benchmark for global oil prices, stands at $71.44 per barrel as of mid-November 2024.
Global factors such as geopolitical tensions, OPEC’s production decisions, and global supply and demand fluctuations play a crucial role in determining oil prices.
If the price of crude oil rises, it generally leads to an increase in fuel prices. Conversely, when oil prices fall, fuel prices tend to decrease. However, this relationship is also impacted by the rand/dollar exchange rate.
Rand/Dollar Exchange Rate
Since South Africa imports most of its crude oil, the exchange rate between the South African rand and the US dollar plays a crucial role in determining the cost of fuel. As of the latest data, the rand is trading at R18.09 per US dollar.
A weaker rand means that South Africa has to pay more for imported crude oil, which can lead to higher fuel prices.
Current Fuel Prices vs. December 2024 Projections
To better understand the impact of the upcoming price changes, let’s compare the expected fuel prices for December 2024 with those for November 2024.
| Region | Fuel Type | November 2024 Price (R per litre) | December 2024 Projected Price Change (R) |
|---|---|---|---|
| Inland | Petrol 93 Octane | R20.98 | Decrease of 16 cents |
| Petrol 95 Octane | R21.30 | Decrease of 4 cents | |
| Diesel 0.05% Sulfur | R18.66 | Increase of 39 cents | |
| Diesel 0.005% Sulfur | R18.77 | Increase of 38 cents | |
| Illuminating Paraffin | R12.87 | Increase of 39 cents | |
| Coastal | Petrol 93 Octane | R20.19 | Decrease of 16 cents |
| Petrol 95 Octane | R20.51 | Decrease of 4 cents | |
| Diesel 0.05% Sulfur | R17.87 | Increase of 39 cents | |
| Diesel 0.005% Sulfur | R18.01 | Increase of 38 cents | |
| Illuminating Paraffin | R11.87 | Increase of 39 cents |
Impact on South African Motorists and Businesses
For motorists, the expected decrease in petrol prices is a welcome relief. Lower petrol prices mean that commuters will have to spend less on fuel, which could lead to savings over time. However, the increase in diesel prices may lead to higher transportation costs for businesses that rely on diesel-powered vehicles.
For industries like logistics, agriculture, and transportation, the rise in diesel prices could increase operational costs, which may eventually be passed on to consumers through higher prices for goods and services.
Moreover, the increase in paraffin prices could affect households, especially those in rural areas or informal settlements, who rely on paraffin for cooking and heating.
As South Africa prepares for the fuel price adjustments in December 2024, it is clear that there will be mixed impacts on different sectors of the economy. While petrol users can enjoy some relief with lower prices, diesel users and households relying on paraffin will face higher costs.
Why are petrol prices expected to decrease in December 2024?
Petrol prices are expected to decrease due to favorable conditions in international oil markets and a slight strengthening of the rand against the US dollar.
How will the increase in diesel prices affect businesses?
The increase in diesel prices will likely raise operational costs for businesses that rely on diesel-powered vehicles, such as those in logistics and agriculture.
What factors determine fuel prices in South Africa?
Fuel prices in South Africa are primarily influenced by international crude oil prices and the exchange rate between the rand and the US dollar.
