Fuel prices may result in welcome news in February after the exchange rate has continued over the past two weeks to trade at the substantially stronger levels since the end of December, despite the sharp rise in the Brent crude oil price, which is the international benchmark for oil prices, says independent economist Fanie Brink.
According to the latest information by the Department of Energy, the prices of gasoline 93 (ULP & LRP) in Gauteng could possibly decrease on Wednesday, 7 February 2018 by 36,9 cents per liter and the price of diesel with a 0,005% sulphur content possibly by 22,5 cents per liter.
The agreement between the members of the Organization for Petroleum Exporting Countries and Russia, which is not a member of the organisation, to further reduce their production until the end of 2018, as well as a higher international demand, has increased the oil price from $63 a barrel to almost $70 a barrel during the past month.
Due to this rise in the crude oil price, the average international gasoline price may increase by 6,2 cents per liter in February and the price of diesel 23,3 cents per liter.
The average daily exchange rate has strengthened from R/$13,46 to R/$12,36 over the past month and can result in a decline of 43,1 cents per liter in the price of gasoline and 45,8 cents per liter in the price of diesel.
The final price changes will be announced by the Minister of Energy by the end of the month.