Petrol Price Drops by R2.90 per Litre in SA

South African motorists have experienced consistent relief over the past year, with petrol prices dropping significantly by R2.90 per litre since June 2024. The Department of Mineral Resources and Energy confirmed yet another decrease in petrol prices, effective from Wednesday, 4 June 2025. This marks the fourth reduction in prices for the year, offering continued support to household budgets amid a challenging economic climate.

From Increases to Encouraging Declines

The year began with a fuel price hike, following a pattern of increases in late 2024. Those spikes were largely linked to international uncertainties, particularly surrounding the US elections and Donald Trump’s re-election, which created volatility in global oil markets. However, these increases weren’t enough to fully reverse the downward momentum established after South Africa’s own general elections in May 2024.

The Power of the Rand in Price Recovery

While global influences played a role, domestic political shifts significantly contributed to the improved outlook. The formation of the Government of National Unity (GNU) helped restore investor confidence, leading to a strengthening of the rand — one of the two critical factors influencing local fuel costs, alongside global oil prices. The rand’s performance cushioned South African consumers from the full brunt of global economic turbulence, despite further currency instability caused by unexpected comments on South Africa by the Trump administration in early 2025.

Global Oil Prices Provide Further Relief

Alongside a firmer rand, a sharp 15% drop in global oil prices since the start of the year — largely attributed to renewed trade tensions triggered by US tariffs — delivered additional relief. This combination of local political stability and international market shifts has enabled steady declines in fuel prices, even amid fiscal uncertainty surrounding the 2025 national budget.

Tracking the Petrol Price Drop: A Year in Numbers

According to official data, prices for Petrol 93 have dropped by R2.67 per litre, Petrol 95 by R2.90, and diesel by R2.43 since June 2024. Here’s a snapshot of key fuel price movements:

Notably, despite occasional upward corrections — especially in November and December 2024 — the broader trajectory has remained downward, reflecting a sustained recovery.

Boost for Inflation and Monetary Policy

The sustained dip in fuel prices has also contributed to a broader economic benefit: easing inflation. With fuel being a key input in transport and logistics, cheaper petrol has helped pull the Consumer Price Index (CPI) below the South African Reserve Bank’s (SARB) target range. After years of elevated inflation, early 2025 saw CPI fall below 3%, surprising many analysts who expected a rebound towards the 4.5% benchmark.

This unexpected softness in inflation prompted the SARB to adjust its outlook for the year, lowering its average CPI forecast from over 4.0% to just 3.6%. The more stable inflation environment enabled the Reserve Bank to reduce interest rates by a further 25 basis points in May, adding to the cumulative 100bp in cuts since September 2024. If current trends continue, further reductions are likely, offering additional economic stimulus.

What Lies Ahead for Motorists

With the rand holding steady and global oil markets leaning towards oversupply and softer demand, analysts remain cautiously optimistic about the fuel price outlook. Although geopolitical risks — especially trade tensions under Trump’s renewed presidency — remain a concern, the balance of factors currently points towards ongoing stability or further gradual declines in petrol costs.

For now, South African drivers can enjoy a bit more breathing room at the pumps — a welcome change after years of unpredictable swings and mounting pressure on household budgets.

Related article: Petrol Price Drop Expected in June – Here’s How Much You Could Pay for Petrol and Diesel