Expect a small saving at the pumps this month as petrol price drops below R20/litre

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Refueling a car in South Africa
Refueling a car in South Africa
  • 95 Unleaded will cost you around R19.61 per litre in January 2022 compared to R20.29 (inland) in December 2021. 
  • The wholesale price of diesel is expected to drop to R17.24 this month from R17.92 last month.
  • Illuminating paraffin is also set to cost less at R10.96 per unit compared to R11.67 per unit last month.
  • For motoring news, go to Wheels24

Although we aren't out of the woods just yet when it comes to the coronavirus pandemic, 2022 has kicked off with good news for motorists with across-the-board reductions in fuel prices as of this Wednesday, January 5th. 

According to an official announcement by the Minister of Mineral Resources and Energy, Gwede Mantashe, petrol is expected to reduce in price by between 68- and 71 cents/litre. Diesel prices are expected to reduce by between 67.8 and 69.8c/litre.

Illuminating paraffin will also cost users less by 95c. The prices of all fuels will be adjusted at midnight on Tuesday and are effective from Wednesday, 5 January.

Strong Rand brings respite

"The Rand had strengthened against the US dollar, pulling away from the lows of mid-December when worries mounted over the economic impact of travel bans imposed as the Omicron variant of Covid-19 swept the world. The Rand has since clawed its way back to around the R15.88 mark, some 40c stronger than its mid-December low," the AA says.

The AA explains that nett oil prices for December have also been more favourable: "Benchmark international oil prices were mostly flat through the first three weeks of December, although they climbed back above $70 a barrel on concerns over the impact of the Omicron variant."

petrol gauge showing half full
Half empty or half full?

Covid will still influence things

The Automobile Association says that with Omicron resulting in considerable infection rates in the Northern Hemisphere, the possibility of lower consumer and industrial demand for petroleum products may follow, as was seen in the initial waves of Covid-19 in 2020 especially. "This could lead to a depressed oil price in the short to medium term. If so, that would bring some relief to South African fuel users. However, this should not distract from the fact that the current fuel prices are still far in excess of what South Africans were paying just a few months ago."

The AA says the current high fuel prices must still be a driving force for reviewing the fuel price structure and an audit of the current prices within that structure.

The AA concludes: "We were pleased that our calls in this regard have reached the ears of the Minister of Finance, Enoch Godongwana. We welcome his pre-Christmas comments that the fuel price structure needs a critical re-look, and we call on him to make quick work of this issue ahead of his 2022 Budget Speech in February. Apart from not increasing the existing levies on fuel at all during that speech, we would also like to see an announcement on concrete plans to review the fuel price before the end of the second quarter."

You can stay up to date with the latest fuel price per region in South Africa here.

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