Petrol could fall by R1/litre - AA

By Drum Digital
29 July 2016

Motorists could see a drop in the petrol price by up to R1 a litre in August as the rand continues its robust run against dollar, according to the Automobile Association

Cape Town - .

The organisation commented on Friday on unaudited month-end fuel price data released by the Central Energy Fund (CEF).

Diesel could go down by approximately 70 cents and illuminating paraffin by about 66 cents, the AA estimates.

"The rand has continued its recent march against the dollar, with an almost uninterrupted two-month streak of gains," the AA said. "The local currency was pegged at R15.70 to the dollar at the end of May, but is now sitting around the R14.20 mark."

At the same time the AA pointed out that, impressive though the rand's performance has been of late, it has contributed only about 25 cents of the expected fuel price drop in August. The balance has been due to the continued retreat of international petroleum prices in the wake of the UK's Brexit vote.

"The landed price of fuel has dropped by almost 20% from its June 22 level," the AA said.

“When taken in the context of the prevailing economic conditions, this windfall will come as a welcome breather to both private motorists and the transport industry.”

The predicted drop in the fuel prices comes amid industrial action in the petroleum sector affecting refineries and depots of petroleum companies.

Regarding this strike, the South African Petroleum Industries Association (Sapia) indicated fuel was in supply, and that it had contingency plans in place for the strike. Sapia advised motorists to stick to their normal refueling patterns to assist the petroleum industry in ensuring security of supply.

Source: Fin24

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