South African motorists stand to gain fresh fuel price relief in August if global oil prices remain steady through July, keeping the pressure off at the pumps. While it is still early to forecast relief, the latest news and data from the Central Energy Fund (CEF) will be welcomed by cash-strapped motorists who are still reeling from hefty price hikes over the past few months.

The Citizen reports that fuel prices have dropped and are continuing the downward trend after reports emerged that the US and Iran signed a memorandum of understanding to end their conflict in the Middle East. This conflict had previously put pressure on global oil supplies, particularly amid concerns over the closure of the Strait of Hormuz.

According to the CEF’s data for the first week of July, both petrol and diesel will experience an over-recovery next month. The CEF data show petrol prices are over-recovered by R2.04 per litre, while diesel recoveries are far higher, with 0.05% (500 ppm) diesel recording an over-recovery of R2.22 and 0.005% (50 ppm) diesel at R2.60 per litre. Illuminating paraffin has also swung into recovery, now at R2.52 per litre.

If these forecasts hold, motorists could see the following adjustments in August:

• Octane 93 petrol: Decrease of R2.02 per litre
• Octane 95 petrol: Decrease of R2.04 per litre
• Diesel 0.05%: Decrease of R2.22 per litre
• Diesel 0.005%: Decrease of R2.60 per litre
• Illuminating paraffin: Decrease of R2.52 per litre

The biggest factors contributing to the monthly adjustments are the average rand/US dollar exchange rate and the average global oil price. Fuel prices in South Africa dropped significantly on July 1, with petrol decreasing by approximately R2.00 per litre and diesel by over R3.00 per litre. This relief was driven by a stronger rand and lower international oil prices, despite the final phase-out of temporary fuel levy reductions.

Earlier this month, the Department of Mineral Resources and Energy announced that, in line with the announcement by Finance Minister Enoch Godongwana, the short-term fuel levy relief had been phased out, effective from July 1. “The short-term relief measures have been completely phased out, and the full fuel levies of 429 cents per litre on petrol and 416 cents per litre on diesel will be reinstated,” it said.

Leadership changes at the CEF

Meanwhile, the CEF confirmed the appointment of Tshepo Mokoka as group CEO, succeeding Ishmael Poolo, who had spent at least five years at the helm. The state-owned entity, responsible for ensuring the security of South Africa’s and the region’s energy supply, announced the appointment in a statement on Friday.

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