PHUTI MOSOMANE
Motorists will pay 70c less on fuel from Tuesday, Minister of Mineral Resources and Energy Gwede Mantashe, announced.
Both 93 and 95 ULP & LRP will drop by 71c a litre. The price of diesel (0.05% sulphur) will drop by 88c a litre, and illuminating Paraffin (wholesale) will drop by 43c a litre (43.00 c/l).
However, the maximum LPGas retail price will increase by 75c a kilo. This LPG price increase is due to the increase in the prices of Butane.
South Africa’s fuel prices are adjusted on a monthly basis, informed by international and local factors.
International factors include the fact that South Africa imports both crude oil and finished products at a price set at the international level, including importation costs, e.g. shipping costs.
Mantashe said the main reasons for the fuel price adjustments are due to the average Brent Crude oil price decreasing from $82.20 to $75.9 during the period under review.
The release of the Chinese Purchasing Managers Index (PMI) data, has decreased indicating lower economic growth.
On the other hand, demand for crude oil imports to China is increasing, although at a slower pace compared to April 2023. However, this was not enough to turn the decreasing trend around.
The collapse of a third bank in the US (First Republic Bank) created further uncertainty and fears of another financial crisis.
The average international product prices of petrol, diesel and Illuminating paraffin followed the decreasing trend of crude oil prices during the period under review while the price of LPG increased.
Petrol and diesel prices decreased even though there is increased demand ahead of the driving season in the Northern Hemisphere.
These factors led to lower contributions to the Basic Fuel Prices of petrol, diesel and illuminating paraffin by 125.11 c/l, 133.83 c/l and 94.95 c/l respectively.
The Rand depreciated on average, against the US Dollar (from 18.13 to 18.99 Rand per USD) during the period under review when compared to the previous one.
This led to higher contributions to the Basic Fuel Prices of petrol, diesel and illuminating paraffin by 54.58 c/l, 50.88 c/l and 52.52 c/l, respectively.
The department said the cumulative slate balance on petrol and Diesel as at the end of April 2023 had a positive balance of R1 265 million. Therefore, there is no slate levy applicable in the petrol and diesel price structure for June 2023.
The additional 1.0 c/l levy in petrol and diesel, which had been implemented with effect from the 3rd of May 2023 to recoup levy payments for April 2023 has been removed. With effect from the 7th of June 2023, the Fuel Levy will decrease to 395.0 c/l and 381.0 c/l respectively in the petrol and diesel price structures respectively.
The fuel prices schedule for the different zones will be published on Tuesday, the 6th of June 2023.
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