South Africa's road freight operators are set for significant cost savings after Mineral and Petroleum Resources Minister Gwede Mantashe announced substantial decreases in diesel prices on Sunday.
The price cuts take effect from Wednesday, January 7.
The adjustments come as a New Year boost to the industry, where fuel typically accounts for a major portion of operating expenses, particularly for long-haul trucking fleets navigating rising input costs and tight margins.
Diesel prices will drop markedly, with 0.05% sulphur diesel decreasing by 137 cents a litre and 0.005% sulphur diesel falling by 150 cents a litre. Petrol prices will also ease, with 93 octane down by 62 cents a litre and 95 octane by 66 cents a litre. The wholesale price of illuminating paraffin drops 110 cents a litre, while the single maximum national retail price declines by 148 cents a litre.
The Department of Mineral and Petroleum Resources said the latest price cuts were driven by favourable international and local factors during the review period.
"The average Brent Crude Oil price decreased from 63.55 US dollars (USD) to 61.47 USD during the period under review. The main contributing factor is the oversupply of oil in the market due to increased production by OPEC+ and non-OPEC producers,” the department said.
International petroleum product prices followed suit, with middle distillates like diesel declining sharply.
"The prices of middle distillates, such as diesel and illuminating paraffin, decreased more significantly because of higher inventories for the winter season in the Northern Hemisphere," the department said.
"These factors led to lower contributions to the Basic Fuel Prices of petrol, diesel and illuminating paraffin by 45.03 c/l, 126.97 c/l and 87.96 c/l, respectively."
Adding to the relief, the rand strengthened against the US dollar.
"The rand appreciated on average against the US dollar (from 17.22 to 16.85 rand per USD) during the period under review when compared to the previous one," it said.
The slate levy remains unchanged.
The price of LP Gas will increase slightly by 21 to 23 cents per kilogram.
