TheCable

The South African government says it will slash the pump price of fuel from Wednesday. 

Gwede Mantashe, South Africa’s minister of mineral resources and energy, said this in a statement on Saturday.

He said the price adjustment is aimed at easing the burden on consumers of soaring energy prices.

South Africa’s fuel prices are adjusted monthly, informed by international and local factors.

“International factors include the fact that South Africa imports both crude oil and finished products at a price set at the international level, including importation costs,” Mantashe said. 

According to the minister, the price of petrol will drop by ZAR 1.32 ($0.08) per litre — to ZAR 25.42 and ZAR 24.99 — for 95-octane and 93-octane petrol, respectively. 

The price of diesel, used mainly by farmers, haulage vehicles and emergency power generators, will also be cut by 88 cents for high-sulphur diesel and 91 cents for lower sulphur diesel, he said.

Mantashe said the prices were adjusted due to less demand for crude oil due to recession concerns and a resurgence of COVID-19 in China.

He added that “the decision by OPEC and Non-OPEC members to increase oil production” was another contributory factor.

“The average international product prices of petrol, diesel, Illuminating Paraffin and LPG have decreased during the period under review. LPG prices have increased due to higher freight rates during the period under review,” he said. 

“The movement in product prices has led to lower contributions to the Basic Fuel Price of petrol ULP 95 by 303.16 c/l, ULP 93 by 297.42 c/l, diesel 500ppm and 50ppm by 267.30 c/l and 271.15 c/l respectively, while the contribution to illuminating paraffin was 249.77 c/l.” 

The minister said the depreciation of the rand also instigated the price reduction. 

In June, the country’s inflation hit a 13-year high of 7.4 percent.