Get ready for another petrol price increase in April while diesel prices are set to drop.
The latest data from the Central Energy Fund shows an under-recovery of about 18 cents per litre for petrol while diesel prices are down by around 32 cents per litre. This seesaw in prices affects everyone’s budget, but there’s a bit of relief for diesel users.
Also read: A swing in South Africa’s fuel fortunes stirs hope for April
Although petrol prices are still on track for a hike, it’s important to note they’re not as steep as initially forecasted earlier this month, when prices were expected to surge by R1.
According to BusinessTech, the decrease in petrol under-recoveries, along with diesel now moving into over-recovery, can be attributed to a stronger rand compared to last month and a decrease in the oil price when measured in rand.
If these trends continue until month-end, it could bring relief to diesel users and industries relying on diesel for operations.
This might also mean a slight easing of inflation pressures, following the February fuel price increases which pushed inflation up to 5.6%, which was higher than anticipated.
Investec chief economist Annabel Bishop told BusinessTech that fuel prices have been a major contributor to inflation pressure since February. Last month saw a significant increase of 75c/litre, impacting not only fuel costs but also the expenses associated with private vehicle operation.
‘March recorded a petrol price increase of R1.21/litre, which will exert some marked upward pressure on inflation in that month. Overall, fuel prices have been adding to volatility in the inflation figures.
‘April is currently on course for only a tiny petrol price hike… as the international Brent crude oil price has dropped lower in rands.’
Explore Cape Town and its surroundings with these incredible deals on cars for under R100 000. Find car listings here.
Nedbank economists agreed. ‘Petrol prices increased by another 5.2% mom and 6.5% year-on-year in March, while gains in global oil prices have offset the slight appreciation of the exchange rate, pointing to more fuel price increases in April,’ the bank stated.
Recent adjustments in the value of the rand have cast a shadow over any potential improvements in petrol prices.
The rand has climbed back above R19 to the dollar, currently sitting at R19.01, driven by expectations of sustained global interest rates.
Despite assurances from the US Federal Reserve about impending rate cuts, market forecasts now suggest these cuts might only materialise later this year. Locally, this translates to anticipated delays, with economists eyeing a potential rate adjustment between July and September.
Cape {town} Etc discount: Looking for things to do in the city at half the price? Let these offers inspire you. Get them here.
Also read:
Finance minister freezes fuel levies for 2024/25 due to high cost of living
Picture: Engin Akyurt / Unsplash
