Fuel prices may take a dive by next month, says independent economist Fanie Brink.
This trend, he said, was expected after the exchange rate had, over the past two weeks, traded at the substantially stronger levels since the end of December, despite the sharp rise in the Brent crude oil price, which was the international benchmark for oil prices.
He said in a statement that, according to the latest information by the Department of Energy, the prices of gasoline 93 (ULP and LRP) in Gauteng could possibly decrease on Wednesday, February 7, 2018 by 36.9 cents per litre and the price of diesel with a 0.005% sulphur content possibly by 22.5 cents per litre.
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“The agreement between the members of the Organisation 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.”
He said that, due to this rise in the crude oil price, the average international gasoline price might increase by 6.2 cents per litre in February and the price of diesel 23.3 cents per litre.
Brink said that the average daily exchange rate had strengthened from R/$13.46 to R/$12.36 over the past month and could result in a decline of 43.1 cents per litre in the price of gasoline and 45.8 cents per litre in the price of diesel.
The Mercury