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Stable Petrol Prices for June due to Positive Oil Trends

Positive Trends in Global Oil Prices and Rand Strength Suggest Stable Petrol Prices for June 2024.

Positive Trends in Global Oil Prices and Rand Strength Suggest Stable Petrol Prices for June
Investec chief economist Annabel Bishop has pointed to positive movements in global oil prices and a strong start for the rand as indicators of potential stability in June’s petrol prices.

Despite the recent fourth consecutive petrol price hike, there are signs that the situation may not worsen significantly.

Global oil prices experienced a decline recently due to delays in the US interest rate cut cycle, leading to subdued expectations of oil demand. This, coupled with the Brent crude oil price falling below US$90.0/bbl, indicates a possible stabilization in petrol prices.

Bishop highlighted the impact of geopolitical tensions on oil price volatility, noting that fluctuations are expected as tensions ebb and flow. Additionally, market expectations of the US replenishing its strategic reserves and a potential Israeli/Hamas ceasefire have contributed to the downward momentum in oil prices.

The rand’s performance is another crucial factor influencing petrol prices. While the rand has shown strength against the US dollar, its volatility remains a concern. Bishop emphasized the rand’s sensitivity to US market events and the need for sustained strength to impact South Africa’s inflation positively.

The relationship between the rand and oil prices extends beyond fuel costs, affecting overall inflation due to international commodity price influences. However, substantial and consistent rand strength is necessary to significantly impact inflation outcomes in South Africa.

Looking ahead, the ongoing volatility in both oil prices and the rand suggests that predicting future petrol prices remains challenging. The Department of Mineral Resources and Energy’s recent fuel price adjustments reflect mixed trends, with petrol prices increasing while diesel prices experience relief.

Despite these fluctuations, the overall picture for May shows positive conditions, with petrol prices stabilizing and diesel prices easing slightly. The combined effects of global oil market dynamics, rand performance, and geopolitical factors will continue to shape petrol price trends in the coming months.

In conclusion, while uncertainties persist, the current scenario presents a relatively stable outlook for petrol prices in the near term, providing some respite for consumers amidst ongoing economic fluctuations.

Fuel Price Changes at the Pumps

Here’s a summary of how the recent fuel price adjustments will reflect at the pumps (please note that diesel prices reflect wholesale prices, and actual pump prices may vary):

RegionFuel TypeApril OfficialMay Official
Inland93 PetrolR24.78R25.15
Inland95 PetrolR25.12R25.49
InlandDiesel 0.05% (wholesale)R22.45R22.15
InlandDiesel 0.005% (wholesale)R22.60R22.24
InlandIlluminating ParaffinR16.19R16.00
InlandLPGAS (per kg)R38.12R37.66
Coastal93 PetrolR23.99R24.36
Coastal95 PetrolR24.33R24.70
CoastalDiesel 0.05% (wholesale)R21.66R21.36
CoastalDiesel 0.005% (wholesale)R21.84R21.48
CoastalIlluminating ParaffinR15.19R15.00
CoastalLPGAS (per kg)R35.16R34.70

These adjustments reflect the recent trends in fuel prices, with petrol prices showing increases and diesel prices experiencing slight reductions, providing insights into the impact on consumers across different regions.

Source: Businestech

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