Diesel price to drop in December but petrol price hike looms

Good and bad news awaits South African motorists in December with petrol prices expected to rise, offsetting an expected sharp drop in diesel prices.

Diesel price to drop in December but petrol price hike looms
The expected drop in the price of diesel may have come too late to offer relief for South Africa’s summer grain producers.
Photo: FW Archive
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According to the latest data released by the Central Energy Fund (CEF) the retail price of petrol would increase by between 30c/l and 41c/l on 7 December.

However, the price of diesel was expected to fall by between R1,48/l and R1,42/l. Illuminating paraffin could drop by 41c/l. As diesel was among one of the major input costs for the agriculture sector, the drop heralded much-needed relief for producers.

Businesslive.co.za reported that, local fuel prices were driven by the international price of petroleum products and the rand/dollar exchange rate. The Brent crude oil price decreased from US$98/barrel (about R1 667,11/barrel) to US$84/barrel (R1 428,95/barrel) in November. The rand strengthened from around R18/US dollar to R17/US dollar over the same period.

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The current retail prices of 93 and 95 petrol inland were R22,57/l and R22,87/l, respectively.

The wholesale prices of high- and low-sulphur diesel were R25,49/l and R25,74/l, respectively.

Anton Botha, a grain producer in the Free State, said any reduction in input costs was always welcomed, especially in the grain production industry. However, the foreseen reduction in the December diesel price had come too late to alleviate costs for summer grain producers.

“The majority of the producers had already purchased about 80% of their diesel earlier in the season. Our diesel demand is at its highest before planting when we have to prepare the grain fields. Considerably less diesel is used during planting,” he told Farmer’s Weekly, adding that he hoped the reduction will stay in place “until harvesting time in 2023.”

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Annelie Coleman represents Farmer’s Weekly in the Free State, North West and Northern Cape. Agriculture is in her blood. She grew up on a maize farm in the Wesselsbron district where her brother is still continuing with the family business. Annelie is passionate about the area she works in and calls it ‘God’s own country’. She’s particularly interested in beef cattle farming, especially with the indigenous African breeds. She’s an avid reader and owns a comprehensive collection of Africana covering hunting in colonial Africa, missionary history of same period, as well as Rhodesian literature.