Petrol prices in South Africa are expected to decrease for the next month thanks to ongoing declines in the price of oil.
This is according to the Automobile Association (AA), which was commenting on unaudited month-end fuel price data released by the Central Energy Fund.
“Rising tensions between the USA and Iran in the opening days of 2020 sparked a sharp increase in international oil prices, but the commodity has rebounded quickly,” the AA said.
“In fact, the oil price has returned to a level we might have expected had the US-Iran flare-up not taken place at all.”
Oil prices have dropped to their lowest since the beginning of December 2019.
The weakening rand has neutered the petrol price drop slightly, and the AA said this is not a good indicator for global confidence in the economy.
“We have some concerns over this ongoing weakening in the absence of any overt rand shocks,” the AA says. “It is not a good sign of confidence in the SA economy.”
Despite this, all fuel types are set for a decrease in South Africa next month.
95 octane petrol will drop by around 13 cents a litre, 93 octane petrol and both grades of diesel by four cents, and illuminating paraffin by three cents.
The price changes are summarised below:
- 95 Petrol – Decrease of 13c per litre
- 93 Petrol – Decrease of 4c per litre
- Diesel – Decrease of 4c per litre
“We’re pleased fuel prices have managed to tread water at the start of a year, a year which is likely to again be extremely economically challenging,” the AA said.