Rand pummels fuel price outlook for July - AA | Fin24
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Rand pummels fuel price outlook for July - AA

Jun 15 2018 11:40
Carin Smith

Fuel prices look set for another jump going into July, the Automobile Association said on Friday, forecasting that a a litre could cost over R16 inland next month. 

The AA was commenting on unaudited mid-month fuel data released by the Central Energy Fund (CEF). "Since the start of June, the rand has steadily weakened against the US dollar, with the average cost per dollar having climbed from around the R12.50/$ mark to nearly R13.00/$," the AA said in a statement.

"Fortunately, international oil prices retreated over the same period and have had a very small impact on the figures." The current data forecast a rise of around 32 cents a litre for petrol; 30c for diesel; and 22c for illuminating paraffin.

Price hikes in June already took the per litre price of petrol into record territory. Motorists currently have to pay R15.20 and R15.79 for a litre of 95 octane unleaded petrol on the coast and inland respectively.

If this were to increase by 32 cents per litre, prices would be R15.52 on the coast, and R16.11 inland. 

"Almost all of the increase is due to rand weakness, and the picture would have looked very much worse if international oil prices had not come down over the past two weeks," explained the AA. "With the volatility of oil markets over the last six weeks, an increase in the oil price cannot be ruled out in the short to medium term, and we once again advise all motorists to avoid unnecessary journeys, make us of car-pooling, and practice economical driving techniques."

At the beginning of June both grades of petrol - 93 and 95 (ULP & LRP) - increased by a hefty 82c a litre.

Diesel 0.05% sulphur and diesel 0.005% sulphur increased by 85c and 87c a litre respectively.

Illuminating paraffin (wholesale) went up by 82c, while illuminating paraffin (SMNRP) cost 109c more per litre.

The Department of Energy ascribed the huge spike in fuel prices in June to a weaker rand and higher global oil prices.

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automobile association  |  oil  |  rand  |  petrol  |  sa economy  |  fuel price


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