Ricochet News

Fuel prices predicted to drop next week thanks to Ramaphosa victory

Dec 28, 2017
Fuel prices predicted to drop next week thanks to Ramaphosa victory

If a prediction by the Automobile Association of South Africa is correct, motorists can expect some relief as fuel prices are expected to drop in the New Year.

While commenting on the unaudited month-end fuel data released by the Central Energy Fund, the AA said that fuel prices are set for a hefty drop after the rand's strong performance against the US dollar.

This is despite increases in international petroleum prices during December.

“The rand has had a very strong run against the dollar since the middle of the month, gaining considerable ground after the ANC's electoral conference chose Cyril Ramaphosa as the new leader of the party,” the AA said.

“After opening the month at R13.80 to the dollar, the rand is now testing the R12.30 level.”

It said that despite higher international oil prices over December, all grades of fuel are set to fall at the Department of Energy's next price adjustment.

Petrol was expected to drop by up to 34 cents a litre, diesel by 26 cents and illuminating paraffin by 28 cents.

“Ramaphosa's political and fiscal position ahead of the February 2018 budget speech is likely to be the most influential determining factor for fuel price movements in the short term,” the AA added.