WHILE the price of diesel and illuminating paraffin looks set for a decline next month, the picture remains unclear for petrol which could increase by six cents a litre.
This is the latest prediction of the Automobile Association (AA) which was commenting on unaudited mid-month fuel price data released by the Central Energy Fund.
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The AA says stability in the international petroleum market could cause diesel to drop by 32 cents per litre and illuminating paraffin by 27 cents per litre.
‘However, the exchange rate performance is coming very close to nudging petrol into a decline, and if the current trends continue, there may be across-the-board relief from the recent series of price hikes at month-end,’ said AA spokesperson, Layton Beard.
The rand has continued on the strengthening trend, which emerged in mid-March, and has gained almost 50 cents against the US dollar.
‘Meanwhile, international petroleum prices have been stable over the same period, allowing the rand to leverage its recent strength,’ said Beard.
With the current price of petrol sitting at around R17 per litre, the AA has called for a complete review of both fuel prices and taxes. In his submission to the portfolio committee on Mineral Resources and Energy recently, CEO of the AA ,Willem Groenewald said extensive research must be conducted into every single element of the fuel value chain which contributes to the fuel price in South Africa.
‘Continuing with a pricing model because it’s historically the one we’ve always used doesn’t make sense; we must ask if there is a better model available and, if there is, we should consider replacing our existing one,’ he said.
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