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AA concerned weak rand could mean more fuel hikes

31 May, 05:35 PM

A spokesperson for the Automobile Association (AA) South Africa, Leyton Beard, is concerned that diminished demand for oil internationally would not be enough to reduce the cost of fuel in South Africa.

Gains in the oil price alone, argued Beard, would not necessarily halt further fuel increases in 2016. On Wednesday, South African motorists will cough up more for petrol, diesel and paraffin (increases are set at 52 cents per litre of petrol of all grades and 76 cents per litre of diesel).

"Looking ahead we are concerned that even if the international oil price moderates the rand, US dollar exchange rate is continuing to weaken," said Beard.

At the beginning of 2016 the outlook for fuel prices looked "fairly good" but April brought an increase in the price of petrol plus an increase in the fuel levy. Now, in June, motorists face another fuel hike in a year of sluggish economic growth and a weak rand.

"I think everybody is going to feel the pinch," said Beard.

Watch above for details on fuel trends in 2016. 

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