The Automobile Association (AA) has commented on the mid-month fuel price data released by the Central Energy Fund, stating that: “Sharp rises in fuel prices are on the horizon.”
At the mid-month point all fuel types are set for price increases, with petrol prices predicted to rise the most at an amount of 80 cents per litre.
Expected price increases for next month for all fuel types are listed below:
- Petrol – 80 cents per litre increase
- Diesel – 61 cents per litre increase
- Illuminating Paraffin – 63 cents per litre increase
“The problem is international oil prices, which have been consistently climbing with each passing day,” the AA said.
“A general increase in positive sentiment as COVID-19 vaccines are rolled out has combined with upticks in global economic activity, pushing up demand for oil – and taking prices with it.”
The average exchange rate of the rand against the US dollar has not been a major contributing factor to the increases, however, and only 4 cents of the predicted increases are coming from rand weakness, stated the AA.
“Unless the picture drastically improves by month-end, South Africa’s fragile economy is set for a major hit.”