Commenting on unaudited mid-month fuel price data released by the Central Energy Fund the AA said the basic fuel price used in South Africa has jumped by eight percent since 1 June, with higher peaks, as international oil prices claw back some of the massive declines of the past four months.
“With world demand expected to continue to increase, South Africans must likewise expect the fuel price to gradually edge back towards pre-COVID-19 levels.”
Current data analysed by the AA shows the price of fuel could change as follows:
Petrol – R1.59 per litre increase
Diesel – R1.48c per litre increase
Illuminating Paraffin – R1.94 per litre increase
It said that while South African’s must expect a return to pre-pandemic prices, it will probably take several months for this to happen.
“South Africans are also benefiting from increasing Rand strength, with the local currency having made up 60c against the US dollar since the start of June, and briefly breaching the psychological R17 to the dollar mark,” said the AA.
“In fact, the rand’s firmer performance in June has offset the fuel price increases by around 36 cents a litre to date.”
Despite this, the AA noted that the rand remains far weaker than it was before the COVID-19 pandemic began.
“Some pragmatism is needed, of course: with fuel showing this kind of increase in just the first two weeks of June, the increase could be much heftier come month-end,” it said.
“If this continues, it might not be long before the R4-a-litre saving motorists enjoyed between February and April is erased.”
“Despite our optimism over a slow rebound for oil, we advise caution, especially with the Rand currently trading around R3 higher to the dollar than before the COVID-19 crisis began,” said the AA.
