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Home General news General

AA predicts a fuel price drop in September

Town Press by Town Press
August 28, 2020
in General
Reading Time: 2 mins read
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Fuel hike expected within days
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The Automobile Association (AA) has predicted a drop in most fuels for September.

Commenting on unaudited data of the Central Energy Fund, the AA says the price of 95 octane petrol is expected to drop by around 4 cents a litre, with diesel going down by 19 cents and illuminating paraffin by 24 cents.

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The AA’s Layton Beard says the only fuel set for an increase is 93 octane petrol which will go up by about 6 cents a litre.

“The bad news for the month was the rand, which pulled back from testing the R16.80 mark against the US dollar in July and headed towards R17.40 at mid-month, with a slight firming trend since. On average, exchange rate losses added around 17 cents a litre to next month’s petrol price. The good news is that a steady performance from international oil prices has offset the rand’s weakness.”

However, the AA warns against complacency, noting that international product prices had made some gains in the last week of August, which could put the fuel price on the back foot in the weeks to come.

“As the country comes to terms with the economic damage caused by the COVID-19 lockdown, there is also concern about government’s ongoing policy uncertainty and levels of corruption as highlighted by the President,” the Association says.

Petrol price increased

The price of fuel increased in August, with the price of petrol going up by five cents more per litre.

Diesel saw the biggest increase of 45 cents, while paraffin will cost 39 cents more.

In June, the price of petrol increased by over R1 per litre, reversing the savings gained in the previous two months when prices plummeted.

The plunge in oil prices, sparked by the softer demand during the global COVID-19 outbreak, as well as the Saudi Arabia and Russia Price war, fuelled the previous price decreases.

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