Mid month data published by the Central Energy Fund points to yet another petrol price hike in May – though at lower levels recorded over the last few months.
The CEF data shows an under-recovery for both 93 and 95 petrol, with prices expected to rise between one to six cents per litre. Diesel drivers however, can expect a reprieve from price hikes, with the CEF showing an over-recovery for 0.05% and 0.005% at around 32 cents per litre.
- Petrol 95: increase of 6 cents per litre;
- Petrol 93: increase of 1 cent per litre;
- Diesel 0.05%: decrease of 31 cents per litre;
- Diesel 0.005%: decrease of 32 cents per litre;
- Illuminating Paraffin: decrease of 26 cents per litre.
While the mid-month data serves as a snapshot, the Department of Energy makes adjustments based on a review of the full period. Furthermore, the outlook can change significantly before month-end.
The mid-month prices provide a strong indication of moving trends, however. Prices are affected by two main components – the rand/dollar exchange rate, and changes to international petroleum product costs, largely driven by oil prices.
At mid-April, the ZAR/USD exchange rate is contributing to an over-recovery of around 16 cents per litre – however, changes to international product prices are leading to diverging trends for petrol and diesel.
Product prices for petrol have remained high, but flat, contributing to an 18-23 cents per litre under-recovery in the price. However, prices for diesel and illuminating paraffin have dropped significantly, hence the 16 cents per litre over-recovery.
The rand has enjoyed relative stability over the last month, trading in a narrow range below R15.00 to the dollar.
The local unit has been riding some momentum on the international front, not giving much sway to the influence of local events. In recent sessions it has traded at the best levels since the start of the Covid-19 pandemic and lockdown.