Ricochet News

Petrol price June 2017: Expect 26c drop in petrol price and 20c drop for diesel - AA

MAY 29, 2017
Petrol price June 2017: Expect 26c drop in petrol price and 20c drop for diesel - AA

Drivers might be in for some petrol price relief in June as the price of petrol price is set to drop, according to a prediction by the Automobile Association (AA) said on Monday.

In May, the Department of Energy increased petrol prices by 49c per litre for all grades owing to factors that included two credit rating downgrades after President Jacob Zuma unceremoniously fired former Finance Minister, Pravin Gorhan, and his Deputy, Mcebisi Jonas.

Diesel increased by between 30c and 32c per liter while illuminating paraffin increased by between 34c and 46c per litre and liquefied petroleum gas increased by 96c per kilogram.

While commenting on unaudited month-end fuel price data released by the Central Energy Fund on Monday, the AA said that; “Our expectation for June is that petrol will drop by up to 26 cents a litre, with a 20 cent drop for both diesel and illuminating paraffin."

The association said that the Rand had strengthened against the US dollar during most of May, with further support from retreating international petroleum prices.

“Both of these factors have contributed to the reduction in the fuel price.”

The AA said a decision by the Organisation of  Petroleum Exporting Countries (OPEC) to continue its production cut for another nine months showed that there was concern about a continued world oversupply of oil, which could mean a period of relative oil price stability.

“With political uncertainty set to continue, our medium-term outlook for the fuel price is that lower international petroleum prices will be key to maintaining local fuel price stability if the Rand weakens again,” the AA added.