While diesel will come down in June, petrol is set to rise once again.
Image: Tumi Pakkies / Independent Newspapers
Following two months of punishing increases, June could have seen some much-needed fuel price relief. While diesel is still looking set for a significant decrease, the phase-out of Treasury's fuel tax relief measures means that a petrol price increase is likely.
Late-month data from the Central Energy Fund shows that the price of petrol should theoretically decrease by between 25 cents (93 unleaded) and 21 cents (95 unleaded) from the beginning of June.
A far more significant over-recovery has developed for diesel, with the same data set pointing to decreases of between R4.60 for 50ppm and R5.29 for 500ppm.
However, the government has indicated that the fuel tax reprieve, announced at the beginning of April, will be halved from June 3 before being phased out at the beginning of July. This means an additional R1.50 needs to be worked into the petrol price and R1.96 into diesel.
With this factored in, South Africans are facing a petrol price increase of around R1.25, while the diesel decrease could be limited to between R2.64 for 50ppm and R3.33 for 500ppm. This follows sharp increases implemented in May and April.
June's predicted adjustment could see 95 unleaded petrol reaching all-time highs of R27.01 at the coast, surpassing the previous July 2022 high of R26.90, while Gauteng residents will now pay in the region of R27.88. The wholesale price of 500ppm diesel is likely to fall to R27.84 in Gauteng.
However, the Slate Levy, which added R1.22 to May's fuel price, could add a further variable to June's official fuel price, which will be announced early next week. This levy compensates fuel companies for price fluctuations in the previous month.
Another interesting development, which could bring relief in the longer term, is that South Africa’s Minister of Mineral and Petroleum Resources, Gwede Mantashe, is pushing for the establishment of a new state-owned company to tackle rising fuel prices.
During his budget vote speech last Tuesday, Mantashe said that South Africa would need a long-term solution to fuel price shocks, as well as a deeper look at its over-reliance on imports.
IOL Motoring