September fuel shock expected as petrol and diesel set for steep hikes

South African motorists face another steep fuel-price shock in September after Central Energy Fund (CEF) data signalled significant increases for both petrol and diesel as international oil prices remain elevated amid the Middle East conflict.

How much more will drivers pay?

CEF figures point to an expected uplift of about 80 cents for 93 Unleaded and 90 cents for 95 Unleaded. The CEF also warns that if the sharper over-recovery seen in recent days persists until month-end, increases could reach R1.00 to R1.10 per litre.

Diesel and paraffin outlook

The diesel outlook is larger: the CEF indicates potential increases of roughly R2.85 for 500ppm and R3.05 for 50ppm. The CEF cautions these figures could rise further if current trends continue. Illuminating paraffin is indicated to be set for an increase in the region of R2.23.

Recent price volatility

The past few months have been volatile for motorists. According to the source data, the price of 95 Unleaded rose from R19.47 in March to R24.71 in August, peaking at R27.19 in June. The wholesale price of diesel increased from R17.70 in March to R25.30 in August, with 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 remain high

International oil markets have seen extreme volatility since the US-Israeli war with Iran began in late February, with the Strait of Hormuz largely closed to shipping traffic. While markets have settled somewhat, Brent crude was trading mostly around $90 per barrel in August, down from highs near $126 earlier in the year but still above pre-war levels of about $70.

“A return to normal flows out of the Strait of Hormuz is now suddenly without any near-term hopes,” said Ole Hvalbye, commodities analyst at SEB, in remarks reported by Reuters.

Analysts do see a gradual softening of international oil prices: JP Morgan projected an average of around $86 for Brent in the third quarter, falling to $80 in the fourth quarter and $78 in 2027.

What this means for September

CEF data points to clear upward pressure on local pump prices in September, with petrol and diesel both set for sharp increases unless global trends change before month-end.