Good news continues as AA predicts January cheer at the pumps

Following the drop in the price of both petrol and diesel for December, the Automobile Association (AA) has indicated that another decrease is being predicated for January should the current status quo continue.

New year festivities continue

Based on the latest mid-month unaudited data report by the Central Energy Fund (CEF), the association says it expects the price of 93 unleaded to drop by 68 cents a litre, 95 unleaded by 82 cents a litre and diesel by as much as R1.50 a litre. Also set to go down is the price of illuminating paraffin by R1.42 a litre.

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The decrease will result in both grades of petrol being marginally above R22 a litre inland and diesel below the R20.50 a litre threshold at the Reef.

Earlier this month, the price of petrol dropped by 65 cents a litre in readiness for the festive season, while diesel went down by between R2.35 and R2.41 as a result of weaker international oil prices and the Rand strengthening against the US Dollar for the period under review.

Relief

Commenting on the CEF’s report, the AA said continuing weakened brent crude oil prices is offsetting the Rand’s loses against the greenback, which, according to Moneyweb, is currently trading at R18.55.

“These decreases will go a long way to alleviating the fuel price burden – and its associated impact on other prices – felt by millions of South Africans,” the association said in a statement.

“For many travellers who will be going on vacation this is also good news as it will undoubtedly reduce expenses on the return leg of their journeys”.

Not yet final

Due to be implemented on 3 January, the predictions are likely to change throughout December based on both the Rand’s performance against the Dollar, as well as oil prices which, by mid-afternoon on Thursday (14 December), had breached $75 a barrel at $75.81 – still down on the $82 recorded earlier in the month.

A secondary report by AA is expected towards the end of the month, followed by an official price confirmation by the Department of Mineral Resources and Energy at the beginning of January.

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