Stronger rand helping petrol price: Economist

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Some reprieve is expected for motorists as petrol prices will drop at midnight on Tuesday but diesel will be more expensive as confirmed by the Department of Mineral Resources and Energy (DMRE).

93 ULP will decrease by 24 cents a litre and 95 ULP by 17 cents, while illuminating paraffin will decline by 4 cents a litre and LP Gas by R2.96 cents a kg.

Wholesale price of high sulphur diesel will increase by 18 cents and low sulphur by 12 cents. The rand strengthening has led to the lower petrol price for the month.

Senior economist at FNB Koketso Mano says “The cut to fuel prices has been supported by the improvement in the rand while international product processes have generally moved sideways. This means that while we should continue to find reprieve from lower oil prices this year relative to last year. The risk to the rand is still material especially when considering key local risk events that are still yet to unfold and we think that its undervaluation should continue in the near term, adding upward pressure to imported inflation.”