AA revises petrol price estimates for September 2016

SEPTEMBER 1, 2016

According to the Automobile Association (AA) renewed oil price strength, and a turnaround in the rand/US dollar exchange rate, may have stop to the substantial petrol price drops for September as suggested by its mid-August data.

“International petroleum prices have put in a surprising rally since the middle of the month,” the AA said.

The Association noted that the stronger rand would have cushioned this increase, but that this is no longer the case as the rand has somewhat weakened.

In mid-August, when the rand was stronger, the AA predicted that petrol would drop by up to 69 cents a litre, diesel by 94 cents a litre, and illuminating paraffin by around 92 cents a litre.

The association said it now expected petrol to fall by around 25 cents a litre, diesel by 54 cents, and illuminating paraffin also by 54 cents.

“The stronger oil price might have been kept in check more effectively had the rand not sagged so sharply against the dollar in the wake of developments around the Minister of Finance, Pravin Gordhan, being the subject of further investigation by the Hawks,” the AA said.