South Africans Set to Celebrate as Petrol Prices Drop Sharply in November

As South Africa nears the conclusion of October, the nation can look forward to a wave of relief at the fuel pumps in November. The latest indicators reveal that fuel price recoveries have remained firmly in the positive, suggesting that motorists could enjoy notable reductions in both petrol and diesel prices next month. This could not have come at a better time, as South Africans have been battling high living costs, with transport making up nearly 15% of household expenses, according to Statistics South Africa.

Key Takeaways

• Fuel prices continue to recover strongly: The Central Energy Fund reports steady over-recoveries for both petrol and diesel, signalling meaningful price cuts for motorists in November.
• Consumers can save more by timing refuelling: Experts recommend waiting until early November to fill up, ensuring drivers benefit from the lower prices once adjustments take effect.
• Economic relief for households and businesses: A sustained drop in fuel prices could ease transport costs, offering much-needed financial relief for commuters and small business owners reliant on fuel.

Fuel Price Over-Recoveries Strengthen, Offering Relief for Motorists in November

Recent information released by the Central Energy Fund (CEF) for the end of the fourth week in October indicates that the pattern of fuel price over-recoveries, which began early in the month, has maintained its strength. Petrol over-recoveries have now stabilised between 57 and 61 cents per litre, while diesel price recoveries have strengthened further, reaching approximately 32 cents per litre. Experts note that every 10-cent drop in fuel prices can save the average commuter hundreds of rands a month, especially for those travelling long distances or managing small delivery businesses.

With only one week remaining in October, analysts are more confident in forecasting the likely adjustments to fuel prices for the coming month. The consistent over-recoveries point to a continuation of downward pressure on prices, even though other economic factors remain in flux. Consumers are advised to delay refuelling their vehicles until early November, when the price adjustments officially take effect, to make the most of the expected reductions.

Expected Fuel Price Adjustments for November

Based on the current data, the expected changes in South African fuel prices for November are as follows:

Fuel Type	Expected Change (per litre)	Adjustment Direction
Petrol 93	-61 cents	Decrease
Petrol 95	-57 cents	Decrease
Diesel 0.05% (wholesale)	-33 cents	Decrease
Diesel 0.005% (wholesale)	-31 cents	Decrease
Illuminating Paraffin	-13 cents	Decrease

While the fuel price recoveries have shown steady progress since mid-October, the external forces shaping them, specifically the exchange rate of the rand and fluctuations in international oil prices, have been less predictable.

The Rand’s Volatile Influence on Fuel Prices

The South African rand has experienced significant volatility, primarily influenced by developments in global financial markets. Its contribution to fuel price over-recoveries has slightly diminished over recent weeks. Whereas earlier in the month the rand accounted for a 15-cent per litre over-recovery, this figure has now eased to around 10 cents per litre. Financial analysts often joke that the rand has “moods” as it tends to strengthen on good political news and weaken instantly on any hint of global uncertainty.

During the past few weeks, the rand has traded within a broad range, fluctuating between R17.00 and R17.54 to the US dollar. At present, it is trading slightly stronger at R17.36 to the dollar. Earlier speculation that the currency might test the R17.00 resistance level has since faded, as market sentiment remains cautious.

The local currency’s instability has been largely driven by swings in the US dollar during October. This volatility stems from the heightened tension between the United States and China, as both nations continue to exchange trade threats. The ongoing trade war between the world’s two largest economies has created uncertainty in global markets, prompting investors to move away from riskier currencies such as the rand.

Local and Global Factors Shaping Rand Performance

According to economic experts, including Investec’s chief economist Annabel Bishop, the rand is expected to remain erratic for as long as the US government maintains its unpredictable trade policies. The uncertainty surrounding these policies continues to weigh heavily on emerging market currencies, including South Africa’s.

Domestic factors are also influencing the rand’s performance. Investors and markets are closely anticipating an announcement on Friday, 24 October, regarding South Africa’s potential removal from the Financial Action Task Force (FATF) grey list. Analysts widely predict that the country will successfully exit the list, and this positive expectation has already been largely incorporated into current market valuations. If South Africa exits the grey list, it could boost investor confidence and potentially attract billions of rands in new foreign investments over the next year, experts say.

Should South Africa indeed be removed from the grey list, analysts believe there will be little to no significant market reaction, as investors have already priced this in. However, if the unexpected occurs and the country remains on the list, a much sharper negative market response could be triggered, leading to potential currency weakness. For ordinary citizens, a stronger rand often translates to cheaper imported goods, including electronics, cars, and even fashion items, a hidden bonus of currency stability.

Oil Price Fluctuations Continue to Influence Recoveries

The second key factor driving fuel price recoveries is the international oil market, which has had a turbulent month. Oil prices experienced a significant decline earlier in October, driven by renewed trade tensions between the United States and China, which dampened global demand forecasts for crude oil. Interestingly, oil remains one of the most politically sensitive commodities in the world, as every $1 increase in Brent crude can eventually raise local petrol prices by about 13 cents per litre.

Adding to the downward pressure, projections of substantial oversupply in 2026 contributed to oil prices dipping below the $60 per barrel threshold, with brief periods even seeing prices fall beneath $58 per barrel. Consumers are reminded that the price of crude oil makes up roughly 60% of South Africa’s petrol price, so when oil falls, it directly benefits motorists unless the rand weakens simultaneously.

Global Events Cause Sudden Reversals in Oil Prices

However, the situation shifted dramatically in recent days. The imposition of new US sanctions on major Russian oil producers has upended the market. These sanctions have heightened concerns about potential disruptions to global oil supplies, while simultaneously increasing demand for alternative oil grades.

This development arrives at a time when global oil production levels remain elevated. Russia, having extensive experience in manoeuvring around sanctions, continues to play a central role in shaping the supply landscape. The sanctions, which have been introduced as a consequence of the ongoing conflict in Ukraine, have injected further instability into the energy market.

The Organisation of the Petroleum Exporting Countries (OPEC) has stated that it stands ready to increase output if the need arises. However, the organisation has also warned that oil prices could climb higher should demand continue to rise unexpectedly.

Currently, Brent crude oil is trading close to $66 per barrel, representing an increase of roughly 7% over the past week. Analysts are keeping a close watch on international shipping activity to assess whether Russian exports may experience any notable interruptions. Any significant slowdown in these flows could drive oil prices even higher in the short term.

Conclusion

The strengthening of fuel price over-recoveries brings a welcome boost for South Africans, offering tangible relief amid ongoing economic pressures. With petrol and diesel prices set to drop in November, both households and businesses stand to benefit from reduced transport and operating costs. Analysts remain cautiously optimistic, noting that while global market forces and currency fluctuations could still influence future prices, the current outlook provides a rare and much-needed reprieve for consumers across the country.