With South African motorists facing the prospect of yet another fuel price rise in March 2025, the latest data suggests challenging times at the pump are far from over. According to reports, mid-month predictions indicate increases of 26 cents per litre for Petrol 93 and 13 cents for Petrol 95, alongside small adjustments for diesel.
February was already difficult for drivers, with petrol prices jumping 82 cents per litre and diesel costs increasing between R1.01 and R1.05, creating anxiety for car owners and commuters alike. Currently, the retail prices for petrol are R22.41 per litre for 95 Unleaded and R22.16 for Unleaded 93.
Predictive data emanates from the Central Energy Fund (CEF) and reflects worrying under-recoveries for fuel prices. Specifically, petrol shows under-recoveries ranging from 13 to 26 cents per litre, whereas diesel demonstrates minor under-recoveries of between 0 and 8 cents per litre. Despite these figures, the CEF’s snapshot recorded improvements from the beginning of February.
The upcoming price adjustments, set to take effect on March 5, are primarily influenced by two significant factors: oil prices and the rand/dollar exchange rate. Brent crude oil futures lingered around $75 per barrel as geopolitical uncertainties continued to shape global market sentiments. South Africa's currency remained steady, with the rand trading at approximately R18.36 to the US dollar, yielding positive over-recovery data for motorists amid the unfortunate prospect of rising fuel prices.
Economic analysts expect the bleak outlook to be complicated by the upcoming budget speech slated for February 19, where Finance Minister Enoch Godongwana may signal potential increases to fuel taxes. The expected decision could arise as part of the government’s larger efforts to manage its R54.7 billion budget deficit. The General Fuel Levy, which contributes about R95 billion to the treasury annually, stands at R3.95, comprising 18% of the retail price, prompting concerns over future tax hikes.
"There have been discussions about the possibility of raising the fuel tax, especially considering our budgetary constraints," Minister Godongwana noted during previous addresses. Observers are wary of any increases, as they would compound the already significant financial burden on consumers.
The Department of Petroleum and Mineral Resources has emphasized, meanwhile, the unpredictability of daily fuel price forecasting, hinting at the potential for slate levy adjustments or shifts in retail margins to emerge leading up to final price determinations.
Looking internationally, the fluctuative nature of oil prices complicates local predictions. Observers note rising crude stocks and recent dips following impactful geopolitical developments. Tuesday's reversal of oil prices, largely driven by anticipated peace negotiations between Ukraine and Russia, has been cited as having positive correlations toward lowering fuel prices.
Despite varying forecasts, George Pavel from Naga.com warns of continued global market volatility. "While we may see some relief, uncertainty still looms as supply issues may arise from geopolitical tensions, which keep pressure on demand and pricing dynamics," Pavel stated.
This precarious environment leaves South African motorists bracing for any price fluctuation. Fuel prices had increased frequently over the months leading up to March, with hikes recorded nearly every month since November of the previous year.
Turning back to local trends, some experts see light at the end of the tunnel. Mid-month evaluations reflect varied oil price developments and potential for slight decreases as the month progresses. This opens the door for cautious optimism among South Africans, particularly concerning the diesel markets.
"It is tricky business predicting fuel prices currently; if oil prices stabilize and the rand maintains its strength against the dollar, we could potentially witness either marginal increases or even negligible price decreases for diesel, which would be very encouraging," commented another analyst.
While nothing is guaranteed, it appears evident South African motorists may need to remain vigilant, keeping watch for any shifts in pricing throughout March 2025. With global and local factors both at play, the continuing volatility emphasizes the necessity for consumers and policymakers alike to navigate these tricky waters with care.