More fuel price pain ahead as sharp petrol and diesel increases predicted for September

South African motorists are bracing for another round of painful fuel-price increases in September, with forecasts from the Central Energy Fund pointing to large diesel hikes and rising petrol under-recoveries.

What the numbers show

CEF data indicate diesel increases in the region of R2.73 a litre for 500ppm and R2.90 a litre for 50ppm. For petrol, CEF is reporting under-recoveries of 66 cents for 93 Unleaded and 77 cents for 95 Unleaded, which the report says could grow to around 80 to 90 cents by month-end if current trends persist. Illuminating paraffin is flagged for an increase in the region of R2.14.

Recent price moves and the recent trend

The CEF snapshot follows months of volatility: the price of 95 Unleaded rose from R19.47 in March to R24.71 in August, having peaked at R27.19 in June. The wholesale price of diesel climbed from R17.70 in March to R25.30 in August, after a peak of R30.30 in May.

At the start of August, both grades of petrol decreased by 52 cents per litre, while diesel increased by between R1.23 (50ppm) and R1.38 (500ppm).

Why prices are volatile

International oil markets have been extremely volatile since the US-Israeli war with Iran began in late February, a period during which the Strait of Hormuz was reported as mostly shut to shipping traffic. Global benchmarks have eased from earlier highs but remain elevated: Brent crude was trading mostly around $90 per barrel in August, down from highs of about $126 earlier in the year and still above pre-war levels of around $70.

“A return to normal flows out of the Strait of Hormuz is now suddenly without any near-term hopes,”

Some analysts expect gradual softening of international prices: JP Morgan projects an average Brent of $86 in the third quarter, falling to $80 in the fourth quarter and to $78 in 2027, according to the CEF summary.

What this means for motorists

The CEF snapshot suggests motorists should prepare for noticeable increases at the pumps in September, especially on diesel. Final adjustments will be confirmed when the month-end calculations are completed.