Lower fuel prices on the cards for July: Here's what to expect

Lower international oil prices will translate to cheaper fuel in July, but the end of tax relief measures will erode next month's decreases.

Significant fuel price decreases are on the cards for South Africa in July, after the truce signed by the US and Iran last week caused international oil prices to subside.

However, assuming that the truce holds, and that the crucial Strait of Hormuz choke point remains open, much of the relief might only be seen in August fuel prices.

The latest daily report from the Central Energy Fund shows petrol price over-recoveries of between R2.93 (95 Unleaded) and R2.97 (93 Unleaded), while diesel is in the green by between R4.60 (500ppm) and R5.02 (50ppm).

But there is an unfortunate caveat. This comes in the form of the fuel tax reprieve, which ends in July, adding R1.50 back into the fuel price calculation. The fuel tax relief measure initially totalled R3.00 in April, but it was halved at the beginning of June. After it falls away completely from July 1, South Africans will once again be paying the full R4.10 per litre General Fuel Levy.