The pump price for a litre of petrol will be 99c/l cheaper for all grades from next Wednesday, while the price of diesel 0,05% sulphur and diesel 0,005% sulphur will decrease by 74c/l and 73c/l respectively.
Motorists will now pay R12,35/l for unleaded petrol inland and R11,87 on the coast.
The department of energy also announced on Friday that illuminating paraffin (wholesale) will cost 66c/l cheaper and illuminating paraffin retail 88c/l.
The maximum retail price for LP gas will decrease by R1,60/kg.
The decrease is mainly due to the strengthening of the rand (the average rand/dollar exchange rate for the period 1 July 2016 to 28 July 2016 was R14,44 compared to R15,16 during the previous period) and the weaker oil price.
The Automobile Association said earlier on Friday the rand has continued its recent march against the dollar, with an almost uninterrupted two-month streak of gains.
The local unit extended its gains, breaking through the psychological R14/$ level as US GDP data came in disappointingly low at 1,2% for the first quarter. The market expected 2,6%. The rand’s move was also impacted as South Africa recorded a trade surplus of R12,5bn in June, the fourth straight monthly trade surplus.
The dollar immediately traded weaker across the board, with the dollar/rand currently at the best levels for 2016, according to TreasuryOne.
The AA, however, said “impressive though the rand’s performance has been of late, it has contributed only about 25c of the expected fuel price drop in August. The balance has been due to the continued retreat of international petroleum prices in the wake of the UK’s Brexit vote.”
The petrol price breather comes amid industrial action in the petroleum sector affecting refineries and depots of petroleum companies.
Regarding this strike, the South African Petroleum Industries Association indicated fuel was in supply, and that it had contingency plans in place for the strike. The association advised motorists to stick to their normal refuelling patterns to assist the petroleum industry in ensuring security of supply.
