The Department of Mineral and Petroleum Resources has released the official fuel price changes, which will come into effect on Wednesday, 4 June 2025. South African motorists will be pleased to learn that fuel prices are set to decline, though the decrease in petrol prices is relatively small. Diesel users, on the other hand, are in for a more significant reduction.
According to the announcement, both grades of petrol—93 and 95 octane—will decrease by 5 cents per litre. While this reduction is modest, it is still a welcome change for consumers amid ongoing economic pressures. Diesel users will benefit more meaningfully, with a 37 cents per litre decrease for both 0.05% and 0.005% sulphur grades. This change is expected to offer some relief to the transportation, agriculture, and logistics sectors, which rely heavily on diesel.
Stronger Rand and Falling Oil Prices Fuel the Drop
The recent fuel price adjustments are primarily driven by two key factors: the strengthening of the South African rand against the US dollar, and a decline in the international oil price. These market shifts have contributed to a reduced Basic Fuel Price, which directly influences the final cost of fuel at the pump.
Between 2 May and 29 May 2025, the rand gained ground against the US dollar, improving from R18.83 to R18.11. This stronger exchange rate helped lower the cost of importing oil, which is priced in US dollars. As a result, the Basic Fuel Price dropped by 39.34 cents per litre for petrol and 39.80 cents per litre for diesel. The improved exchange rate played a vital role in softening the impact of international oil price fluctuations on domestic fuel prices.
Brent Crude Oil Prices Also Contributed to the Reduction
In addition to the improved exchange rate, the global oil market experienced a slight downturn during the same period. On 13 May, the price of Brent Crude oil was recorded at $66.63 per barrel. By the end of the review period, this had fallen to $63.48 per barrel. The drop in oil prices further contributed to the reduction in the Basic Fuel Price, helping offset some of the costs that would otherwise be passed on to consumers.
However, despite these favourable developments, the final pump price is not as low as it could have been. This is because the South African government has decided to increase the General Fuel Levy (GFL) in lieu of implementing a proposed VAT hike. As part of the new pricing structure, the GFL will rise by 16 cents per litre for petrol and 15 cents per litre for diesel. This policy move was made to maintain revenue levels while avoiding a broader consumption tax increase.
While the hike in the General Fuel Levy reduces the net savings for motorists, there is a silver lining. The Slate Levy, which is used to recover losses by fuel companies, will remain unchanged at 0.00 cents per litre. This decision aligns with the self-adjusting Slate Levy mechanism that regulates fuel pricing stability and aims to prevent sudden spikes due to market imbalances.
Petrol Prices for June 2025
Below is a breakdown of the new fuel prices as they will appear at the pump from 4 June 2025:
- Petrol 93 will now cost R21.24 per litre inland and R20.45 at coastal locations.
- Petrol 95 will be priced at R21.35 inland and R20.52 along the coast.
- Diesel 0.05% will retail at R18.53 inland and R17.70 at coastal pumps.
- Diesel 0.005% will cost R18.57 inland and R17.81 at the coast.
Though the petrol price cut may seem negligible, the more substantial decrease in diesel prices offers some welcome economic relief. With these adjustments, businesses and consumers alike can hope for slightly lower transportation and supply chain costs in the weeks ahead. The next review of fuel prices is scheduled for early July and will depend on fluctuations in the global oil market and the performance of the rand.
Related article: Will the Petrol Price Increase in June 2025?
