Motorists should steel themselves for the price increases that await them at the fuel pumps in October.
Based on unaudited data from the Central Energy Fund (SEF), the Automobile Association (AA) predicts that petrol may rise by around R1.20 per litre, while diesel motorists may be out of pocket R2 more per litre. All indications are that paraffin may also rise by R1.84 per litre.
“Should these significant increases materialise, it would push fuel prices up to levels last seen in July last year,” says the AA.
“This will leave South Africans even further in a pinch.”
The AA argues that higher fuel prices will inevitably lead to higher food prices.
“This will be a further blow to those who are already struggling financially.”
The SEF’s data points out that the main driver behind the possible increases is the higher international oil prices, which have risen significantly since last month. This is mainly due to reduced output by major oil producing countries.
In the case of petrol, up to 80% of the price increases can be attributed to higher oil prices. More expensive oil is also the reason for 86% of the expected increase in the price of diesel.
The weaker rand against the US dollar also contributes to the expected price increases, but its impact is currently minimal compared to that of rising oil prices.
“The outlook is certainly bleak, although it has improved slightly since the beginning of the month. With just two weeks left before the official price adjustment for October, there is hope that the downward trajectory will continue until then.”
The AA says a price rise in fuel is a certainty for October, the question is just how much it will rise.