The economic woes in the developed world are likely to drive the international oil price lower in coming months.
However, a repeat of the second half of 2008, when the Organisation of Petroleum Exporting Countries (Opec) oil basket price collapsed from a monthly average of $131,22 per barrel in July to $38,60 per barrel in December, is unlikely unless there is a disorderly breakup of the euro zone.
The Opec basket price tends to be a better predictor of South African fuel prices, as the daily price uses refinery prices from the Middle East and Singapore as benchmarks, rather than the Brent oil price. Brent tends to be more volatile as it is the crude oil benchmark for the financial market in London.
› Cosatu pushing for minimum wage policy
› Global woes to drive down oil price
The current basket contains: Saharan Blend (Algeria), Girassol (Angola), Oriente (Ecuador), Iran Heavy (Islamic Republic of Iran), Basra Light (Iraq), Kuwait Export (Kuwait), Es Sider (Libya), Bonny Light (Nigeria), Qatar Marine (Qatar), Arab Light (Saudi Arabia), Murban ( United Arab Emirates) and Merey (Venezuela).
This is the silver lining in the dark cloud of gloomy economic news currently dominating the headlines.
Today South African motorists will enjoy a 55c/l cut in the retail petrol price, while the wholesale price of diesel will be 24,8c/l lower.
Article continues on page two: how much relief consumers can expect in coming months...