Consumers rushed to buy petrol on Tuesday after newly-elected President Bola Tinubu announced the end to Nigeria's costly fuel subsidies

The South African government provided a new year relief to the motorists as the Department of Mineral Resources and Energy (DMRE) announced cuts in the prices of petrol and diesel due to lower international oil prices. However, higher freight costs weighed on the prices of liquefied petroleum gas (LPG).

The average brent crude oil price fell to $77.35 during the period under review from $82.62, driven mainly by increased production by the U.S., Venezuela, Guyana, and other non-OPEC countries despite the announcement by the Organization of the Petroleum Exporting Countries (OPEC) to cut production.

Gwede Mantashe, Minister of Mineral Resources and Energy, said Tuesday that the prices of 93-grade standard unleaded petrol (ULP) and lead replacement petrol (LRP) will decrease by 62 cents a liter. Whereas, 95-grade ULP and LRP prices will be cut by 76 cents a liter to R22.49.

In addition, the price of diesel (0.05% sulphur) will see a drop of 118.32 cents a liter, while of diesel (0.005% sulphur) will be cut by 126.32 cents a liter.

Illuminating paraffin (wholesale) price has also come down by 93 cents per liter and the single maximum national retail price (SMNRP) for illuminating paraffin reduced by R1.24 per liter.

The fuel price adjustments were made on various factors including crude oil prices, international petroleum product prices, the exchange rate difference between South African currency Rand and USD, the implementation of the Slate Levy and the octane differential between 95 and 93 petrol grades.

"The average international product prices of petrol, diesel and illuminating paraffin decreased in line with the lower crude oil prices. LPG prices increased due to higher freight cost," the minister explained, SA News reported.

"These factors led to lower contributions to the basic fuel prices of petrol, diesel and illuminating paraffin by 50.83 cents a liter, 105.81 cents a liter and 99 cents a liter, respectively," Mantashe added.

Meanwhile, the minister noted that a slate levy of zero cents a liter will be implemented, down from 26.32 cents per liter earlier, resulting in savings of 26.32 cents for motorists.

Last year in August, the DMRE announced an increase in all grades of petrol and diesel prices, noting that petrol prices have increased by 37 cents per liter while the diesel (0.05% sulphur) has been increased by 72 cents per liter.

To determine the basic fuels prices (BFP), the government considers 95 octane (unleaded) grade as the price-marker grade and the BFP-differential between 95 and 93 octanes is changed on the first Wednesday of every quarter.