June is the last month in which the fuel levy is lower than its normal rate of R4.10 per litre for petrol and R3.93 per litre for diesel.

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Despite the ongoing conflict in the Middle East, South Africans are likely to get worthwhile relief when they buy fuel in July.

With two out of the four weeks determining July’s fuel prices clocked, there are overrecoveries (forecasting price drops) on all kinds of fuel, varying from R2.52 per litre on 95-octane petrol to up to R4.57 per litre on wholesale diesel with 0.005% sulphur. The overrecovery on wholesale paraffin is R4.88 per litre.

However, the actual price cuts on petrol and diesel will be lower because the general fuel levy will be restored to its full value, adding R1.50 per litre back to the petrol price, and R1.97 per litre to the diesel price. Relief of R3 per litre for petrol and diesel was implemented for April, which was increased to R3.93 (the full value of the levy) for diesel in May; the relief was halved for June; but will now fall away on 1 July, restoring the levy to R4.10 per litre for petrol and R3.93 per litre for diesel.

This means that, if prices could change today, 95-octane petrol would become about R1 per litre cheaper and diesel with 0.005% sulphur R2.60 per litre.

Another unknown is the value of the Slate levy. In June, it was increased to R1.57 per litre, following a massive negative balance of R18.28 billion in the slate fund. While it is unlikely that the balance could have been reduced to -R500 million – the level at which the levy could be scrapped – it might be decreased if fuel importers had, on average, paid less for fuel on international markets than the regulated price they could sell it for in SA.

In July, a couple of cents variation will be added as the differential between 93- and 95-octane fuel is changed quarterly.

The final overrecoveries will depend on the rand-dollar exchange rate and international fuel prices over the next two weeks. Currently, the somewhat stronger rand is adding between 14c and 18c per litre to the overrecoveries.

July’s fuel prices will be announced by 30 June and will take effect on 1 July.

The pump price of 95-octane petrol is currently R28.06 per litre in Gauteng and R27.19 at the coast, both all-time records. The wholesale price of diesel with 0.05% sulphur is R27.93 per litre in Gauteng and R27.05 per litre at the coast. Diesel shot up to a record price of more than R30 per litre in May, but dropped by about R2.60 per litre in June.