Affected by the ongoing increase in oil prices and a limited exchange rate, pump prices are expected to go higher in the beginning of the month of July.
The increase in oil prices poses a big challenge not just to SA but to the entire countries of the world and this has greatly affected prices of products mostly food products.
The Automobile Association (AA), which was commenting on unaudited mid-month data released by the Central Energy Fund (CEF) postulated the increase from the coming months.
“International petroleum prices have appreciated less sharply in the month to date than was the case in the equivalent period in May, but the gains have nonetheless been significant,” the AA said.
“Meanwhile, the stronger Rand / US dollar exchange rate has not been enough to counter oil’s rises, giving a risk of substantial fuel price hikes at the beginning of July.” the association said.
The pump price would by next month rise to 27 cents a litre for petrol and 61 cents a litre for diesel as predicted by the mid-month data.
This means starting June, you are expected to pay R13.53 for 95 fuel instead of R13.26 and R11.88 for 0.05 diesel instead of the usual R11.28
“With the cold of winter having set in, people who use paraffin for heating and cooking are poised to experience a sharp jump in their energy costs, in addition to a rise in transport-related costs,” the AA said.
“Economic shocks which weaken the exchange rate could worsen the picture by month end,” it said.
“We advise South African motorists to reconsider their driving patterns and car sharing habits, in order to economize in the event that the current run of fuel price rises continues in the medium term,” the AA said.
This calls for a more stringent spending for next month. Like the finance minister Pravin Gordhan had advised, experts say people should make better fitting financial budgets for next month and cut down all unnecessary spendings.