Fuel prices are likely to show marginal changes in February, according to the Automobile Association (AA) with diesel set for an increase of 13 cents per litre.
The (AA) predicts the price of unleaded 95 Octane petrol to drop by eight cents a litre in February, but 93 Octane petrol, diesel and illuminating paraffin are all set for a price rise at month end.
The AA was commenting on unaudited mid-month fuel price data released by the Central Energy Fund. The AA says 93 Octane petrol is showing a one cent-a-litre rise, with 13 cents for both grades of diesel, and ten cents for illuminating paraffin.
"International oil prices surged by nearly two dollars a gallon in late December 2019 before beginning a recovery which was halted by the recent tensions between the USA and Iran" the AA says. "In the first week of January 2020, the two dollar mark was tested again, albeit with a slight recovery since."
Political tensions in the Middle East feed uncertainty
The AA says that the Rand, which dropped as low as R13.95 to the US dollar at the end of December, had also begun to tick up, passing R14.40 at the close on Tuesday 14. "This rise means bad news for fuel users and comes at a time when many consumers are already feeling the financial pinch," notes the Association.
The AA says that political tensions in the Middle East, one of the world's richest oil-producing regions, are likely to produce continued uncertainty which would feed into oil price movements. "The Rand's performance will be key in keeping any further oil hikes at bay," it concludes.