The minor fuel price cuts announced in early March are looking set to be followed by more significant decreases for both petrol and diesel in April.

Data from the Central Energy Fund (CEF) is pointing to petrol price decreases in the region of 93 cents for 95 Unleaded and 80 cents for 93 Unleaded, while diesel prices look set to go down by between 92 cents (500ppm) and 94 cents (50ppm).

Should these predictions materialise, the price of 95 Unleaded will drop to around R20.60 at the coast and R21.40 inland, where 93 should land around the R21.25 mark.

The price of both grades of petrol came down by seven cents at the beginning of March. This followed increases of 82 cents in February, 19 cents in January, 17 cents in December and 25 cents in November.

Lower oil prices, stronger rand

The predicted price decreases for April come mostly as a result of lower international product prices, with a slightly stronger rand contributing about seven cents to the current over-recoveries on both petrol and diesel.

However, this anticipated price relief will depend on oil prices remaining at their current levels or lower for the remainder of March.

The price of Brent Crude oil has receded since early March, when oil cartel OPEC+ announced that it would raise oil production.

Last week Brent dipped below $70 per barrel (R1,286) for the first time in six months, marking a significant decline from the mid-January highs of $81. The price has risen to $71 this week following US attacks on the Yemeni Houthis.

“Crude oil futures rebounded amid rising tensions in the Middle East. US operations against Yemen’s Houthis could leave traders on edge. The geopolitical risks could support oil prices in the short term, but the market could remain cautious in the face of the uncertainty regarding the long-term impact,” said Milad Azar, market analyst at XTB Mena.

Broader economic concerns continue to weigh on oil prices however, with fears of a global economic slowdown exacerbated by escalating trade tensions between the US and other major markets.

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