The AA has predicted that petrol prices will increase and diesel prices will decrease in August. It was commenting on unaudited month-end fuel price data released by the Central Energy Fund.
“International oil prices have steadily trended upwards since the start of June, although there has been a slight pullback since a peak on July 11,” said the AA.
“Since then, diesel prices have edged higher while petrol remained flat, although the currency remains volatile going forward.”
The AA predicts that petrol will increase by about 12 cents per litre, while diesel prices will decrease by approximately 16 cents per litre.
It added that volatility in oil prices is set to continue, and many competing factors are contributing towards this, including US inventory levels, political instability in the Middle East, and a possible demand plateau in the medium-term.
“The average Rand/dollar exchange rate crossed R14.20 last week despite spending much of July stronger against the US currency. This volatility can come into play before Wednesday’s adjustment and may even have a bearing on the September outlook,” said the AA.
Below is a summary of the price changes expected for August 2019:
- Petrol price increase of 12c per litre
- Diesel price decrease of 16c per litre
The AA has also cautioned that South African fuel prices are still prone to drastic changes due to South Africa’s weak economic position and the unpredictability of international oil prices.
“Anything which shocks oil higher or the Rand weaker has the potential to cause sharp fuel price increases.”