South African motorists can look forward to a bit of relief at the pumps in March, as new data from the Central Energy Fund (CEF) suggests that fuel prices are set to decrease—at least for most fuel types. After weeks of uncertainty, a weaker dollar and lower global oil prices have resulted in a shift in price recoveries, bringing small but welcome cuts for petrol 95, diesel, and illuminating paraffin. However, not all fuels will see a drop, as petrol 93 is still expected to rise slightly.
What to Expect at the Pumps in March
Based on the latest month-end data, here’s what South African motorists can anticipate for fuel price changes next week:
●This is the new price of Petrol (93:)** ▪︎The original price is going to increase by the total amount of 9 cents per litre.
●The new price of Petrol (95:)will be reduced by four (4)cents per 1 litre.
- Diesel 0.05% (wholesale): Decrease of 14 cents per litre
- Diesel 0.005% (wholesale): Decrease of 20 cents per litre
●The total amount of Illuminating paraffin will decrease of 4 cents per 1 litre*
While petrol 93 is still set for a slight increase, it’s worth noting that the projected hike is lower than earlier estimates. Just last week, an 18-cent-per-litre increase was expected, but this has now been revised down to 9 cents.
Why Are Prices Changing?
The fuel price adjustments are largely driven by international factors, particularly fluctuations in the rand/dollar exchange rate and global oil prices. The weaker US dollar has played a key role in improving price recoveries, making fuel imports slightly cheaper for South Africa.
According to Investec chief economist Annabel Bishop, the rand’s recent strength is more about US dollar weakness than local economic improvements. Since mid-January, the dollar has been under pressure following policy shifts in the Trump administration, particularly a move away from aggressive tariff hikes that could have driven inflation higher.
As a result, there is now a growing expectation of a second US interest rate cut this year, which would further weaken the dollar. However, Bishop warns that Trump’s policies remain unpredictable, meaning future changes in fuel prices will continue to be influenced by global political and economic developments.
South Africa’s Local Challenges
While international trends are playing a major role in fuel prices, South Africa has its own economic hurdles that could still impact the rand in the coming months.
Recent political and economic developments, including the postponement of the 2025 Budget Speech and the return of stage 6 load shedding, have created uncertainty. Despite these challenges, Bishop notes that markets have remained relatively unfazed, as investors have come to expect weak economic growth and power outages in South Africa.
Oil Prices on the Decline
One of the biggest factors contributing to the expected drop in diesel and petrol 95 prices is the significant decline in global oil prices. In February, crude oil prices dropped back toward $72 per barrel, after starting the month above $75.
Bianca Botes, director at Citadel Global, attributes this to a surprise increase in US fuel inventories, which has led to fears of an oversupply in the market. Simply put, oil production is outpacing demand, pushing prices down.
Much of this shift is linked to US economic policies. The Trump administration has been hinting at boosting US oil production, adding more supply to an already saturated market. At the same time, ongoing trade tensions—including potential new tariffs on Canada, Mexico, and the European Union—are dampening global fuel demand.
According to analysts at Bloomberg, these economic policies are keeping oil futures trading at lower levels, despite some upward pressure from tighter sanctions on Iran and potential delays in OPEC+ reopening closed production sites.
Official Announcement Coming Soon
While the projected price changes provide a good indication of what to expect, the final official fuel price adjustments will be announced by the Department of Petroleum and Mineral Resources in the coming days. These new prices will come into effect on Wednesday, 5 March 2025.
What This Means for Motorists
- Good news for diesel users: With wholesale diesel prices set to drop between 14 and 20 cents per litre, businesses that rely on transport and logistics could see slight operational savings.
- Mixed news for petrol drivers: If you use petrol 95, you’ll enjoy a small 4-cent-per-litre cut, but if you’re filling up with petrol 93, expect to pay 9 cents more per litre.
- Small relief for households using paraffin: Illuminating paraffin, commonly used for heating and lighting, will drop by 4 cents per litre, offering slight relief for consumers who depend on it.
While these changes may not be drastic, every little bit helps in the face of rising living costs. However, as global economic uncertainties persist, South Africans should remain prepared for further fluctuations in fuel prices in the coming months.
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