Big shift in petrol prices for October

The continued strengthening of the rand versus the dollar and weaker global oil prices have reversed the expected hikes in petrol prices for October. 

At the beginning of the month, the Central Energy Fund’s (CEF) data indicated a significant hike of around 20c per litre was expected for both grades of petrol. 

However, the latest data indicates that South African motorists may experience some relief at the pumps next month. 

The picture is slightly different for diesel users, with the expected cut for October being significantly reduced towards marginal relief. 

This is largely due to declining refinery capacity in Europe and the United States, putting pressure on diesel supply. 

The CEF’s latest data indicates the following changes to the price of various fuel types for South African motorists for October –

• Petrol 93 – no change
• Petrol 95 – increase of 8 cents per litre
• Diesel 0.05% – decrease of 10 cents per litre
• Diesel 0.005% – decrease of 8 cents per litre

Oil prices have continued to weaken throughout September as traders bet on demand slowing as a result of US tariffs on trade. 

The disruptions to global trade are expected to translate into slower global economic growth and thus, less demand for fuel. 

This expected decline in demand is coupled with the steady addition of new supply from members of the Organisation for Petroleum Exporting Countries (OPEC). 

The organisation has lifted some of its supply caps on its member states, enabling them to increase production for sale on the global market. 

However, this situation of declining demand and increasing supply may be under threat from a renewed focus on sanctions on Russia’s oil industry from the West. 

More severe sanctions may result in disrupted global supply as China and India continue to consume significant amounts of Russian oil. If they are forced to find oil elsewhere, it may cause a momentary uptick in prices. 

Overall, Brent Crude prices have slipped by over 3% over the past month as the supply surplus is expected to widen further in the coming months. 

On the other hand, the rand has continued its strong run against the US dollar, with it strengthening by over 1% against the greenback over the past month. 

This is largely due to renewed dollar weakness on the back of growing concern in the fiscal health of the United States, elevated uncertainty, and Trump’s attacks on the Federal Reserve. 

While the rand has had a strong run so far in 2025, and this is likely to continue given the rise in commodity prices, there are some clouds on the horizon. 

South Africa’s current account deficit widened in the latest reading from the Reserve Bank, indicating continued export weakness and greater reliance on imports. 

While the deficit is still small at around 1% of GDP, if it continues to widen then it could have a substantial impact on the value of the rand. 

The graph below shows the change in expected fuel prices over the past month, courtesy of the CEF.