The price of 95 (ULP and LRP) and 93 (ULP and LRP) would come down by 9 cents a litre
DURBAN – THE Department of Mineral Resources and Energy (DMRE) announced that fuel prices made a welcomed turnaround on Wednesday, from last month, with across-the-board price cuts in all fuel types.
The department said the price of 95 (ULP and LRP) and 93 (ULP and LRP) would come down by 9 cents a litre.
Diesel (50ppm) will decrease by 31c a litre diesel (500ppm) will fall 30c a litre.
The price of illuminating paraffin (wholesale) will fall 23c. Illuminating paraffin (SMNRP) will decrease by 30c, while the maximum retail price for LP Gas will decrease by 172c a kilogram.
Minister of Mineral Resources and Energy Gwede Mantashe said the main reasons behind the adjustment was due to the average Brent crude oil price decrease per barrel during the period under review, the movement in international petroleum product prices of diesel and illuminating paraffin, followed by the decreasing trend in crude oil prices and the rand/US dollar exchange rate, which saw the rand appreciate slightly.
He added that the vessel stuck in the Suez Canal, which delayed all cargo containers including oil tankers, once freed, eased fears regarding supply disruptions.
The Automobile Association (AA) said in a statement that it believed fuel users would finally have a breather this month after a series of fuel price increases earlier in the year, following the rand’s strengthening trend against the dollar.
“As we head into winter, South Africans who use paraffin for lighting, cooking, and heating especially, will no doubt be glad at this news. For its part, the AA is hopeful the recent streak of price stability will continue to provide more price relief to fuel users, in the short to medium-term,” the AA added.
Economist Meshel Muzuva, a senior finance and economics lecturer at MANCOSA, warned that while the stronger rand had come to the rescue of South African fuel users, consumers must be wary of the constant instability of local and global economies, which inevitably affect fuel prices.
“The impact of the decrease in the price of paraffin will result in poorer households witnessing a decrease in their cost of living. Consumers will also benefit from the lower prices of transport and fuel, and this will effectively increase their disposable income and enable them to spend more on other goods,” said Muzuva.
Muzuva said the weakening of the rand in future could push the fuel price further, to unsustainable levels, and bite the little income at the disposal of households.