Africa-Press – South-Africa. South African motorists are set for substantial relief in January, with data indicating cuts for both petrol and diesel at the pumps.
This is on the back of declining international oil prices, which have come under renewed pressure amid a forecasted record surplus in 2026.
The rand, on the other hand, has held its own against the dollar and has maintained its level below R17 to the greenback.
South Africa’s Central Energy Fund tracks these changes to forecast the changes to petrol and diesel prices for the coming month.
Its latest data indicates the following changes at the pumps in January 2026 –
Petrol 93 – decrease of 27 cents per litre
Petrol 95 – decrease of 30 cents per litre
Diesel 0.05% – decrease of 106 cents per litre
Diesel 0.005% – decrease of 115 cents per litre
The data also indicates that the majority of this is due to declining international oil prices, with the sharper decrease in diesel prices due to easing supply pressures at refineries.
Oil is on track for its worst annual loss since 2018 as global supplies are beginning to outstrip demand, despite renewed sanctions on key Russian producers and tension between the United States and Venezuela.
Any increases in tension or potential supply disruptions have been drowned out by forecasts of a record oil production surplus in 2026.
In the case of Venezuela, it supplies less than 1% of global oil production. This means that any action against the country is unlikely to significantly alter prices.
Oil prices are under heavy downward pressure, with the International Energy Agency (IEA) projecting a record surplus for 2026.
The IEA’s projection is based on expected subdued demand and increased supply, particularly from the Organisation of Petroleum Exporting Countries (OPEC).
OPEC has lifted production caps on its members for them to maintain their market share. This, however, will come with lower oil prices.
The rand, on the other hand, has held its own against the dollar in recent months, having strengthened by over 9% against the greenback so far in 2025.
The currency’s strength has largely come from a weaker dollar and soaring precious metals prices, which have boosted South Africa’s terms of trade.
However, it has also been driven by South Africa’s improving fundamentals, with faster-than-expected economic growth and improving government finances.
As a result, investors have increased their interest in South African assets, with the government raising $3.5 billion in a sale of dollar bonds that attracted demand for almost four times that amount.
This auction saw the rand trade at its strongest level in three years, hovering just below R17 to the US dollar.
This has combined to push the rand-oil price to its lowest level since September 2021, which should translate into lower prices at the pumps for motorists.
More importantly for motorists, the price is 20% below the levels it was at just a year ago, promising sustained relief at the pumps.
Furthermore, this should translate into subdued inflation in 2026, which is crucially important for the Reserve Bank to meet its new 3% target.
This has the potential to substantially boost the spending power of South Africans, driving faster economic growth in the near term.
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