Despite a strengthening Rand/US Dollar exchange rate, the Automobile Association of South Africa (AA) is anticipating a fuel price hike in May. This follows the release of the unaudited month-end fuel price data released by the Central Energy Fund (CEF).
“The exchange rate showed a creditable strengthening during April. With a flat oil price, consumers could have expected the price of fuel to drop by up to 29 cents a litre. But the recent increase in international product prices means that diesel will only drop by three to four cents a litre, with a nine cent drop on the cards for illuminating paraffin,” revealed the AA.
Rather than a decrease in the price of petrol, the AA predicts that consumers can expect a 42 cents per litre increase in the “landed price of petrol,” which will result in petrol users paying an additional 12 cents per litre at the pump.
“International petroleum prices have settled into a pattern of gains which are not always being overcome by recent Rand strength against the dollar. We forecast steady rises in the price of fuel in South Africa in the short to medium term, with the possibility of larger spikes if the Rand comes under pressure,” stated the AA.
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