Further drop in petrol price

Cape Town - The pump price for a litre of petrol will be 18 cents cheaper for all grades from next Wednesday, much lower than the expected 25c touted still earlier this week.

The price of diesel 0.05% sulphur and diesel 0.005% sulphur will drop by 48c and 49c a litre respectively.

Motorists will now pay R12.17/l for unleaded petrol inland and R11.69/l on the coast.

The Department of Energy also announced on Friday that illuminating paraffin (wholesale) will cost 47c/l cheaper and illuminating paraffin (SMNRP) 63c/l.

The maximum retail price for LPGAS will decrease by 9 cents a kilogram.

Renewed oil price strength and a turnaround in the rand/US dollar exchange rate have put the brakes on the expected substantial fuel price drops, the Automobile Association said on Tuesday, when it still expected a 25c/l drop in the pump price of petrol.

In mid-August the AA said it expected petrol to come down 69c/l based on the rand's strength, with diesel predicted to drop by 94c/l and illuminating paraffin by about 92c/l.

The rand, however, suffered a significant decline since then on the ongoing political turmoil surrounding Finance Minister Pravin Gordhan and state-owned enterprises.

The currency reacted negatively to the Hawks' circling of Gordhan over his involvement in the so-called rogue unit at the South African Revenue Service during his time as commissioner. On Wednesday it was pummelled after Futuregrowth Asset Management, which has about R170bn in assets, took an unprecedented decision to halt loans to key state-owned enterprises.

At 14:00 on Friday the rand was trading at R14.55/$ and Brent oil at $46.16 a barrel.