While South Africans prepare to usher in the new year with high hopes that all will be well, the Automobile Association (AA) comes with news that won’t be pleasant to the ears of motorists. The association predicts that fuel pump price will increase by 51 cents in January.
This is according to authorities in the association who revealed that price of petrol is expected to rise by 51 cent a litre while diesel will rise by about 40 cent. The group said the Central Energy Fund on behalf of the Department of Energy will officially announce the new pump price on Friday.
“The rand has weakened against the US dollar since mid-December, while international petroleum prices have continued their upward march,” the association said as it predict that January would be the first of a series of fuel price increases during 2017.
“However, despite the rand’s recent weakness, it was comparatively strong in the first half of December, and the anticipated fuel price rise is entirely attributable to petroleum strength.”
AA also noted that if international petroleum prices had remained unchanged from November, South African fuel prices would actually have dropped by around two cents a litre in the new year.
Instead, petrol is expected to increase by 51 cents a litre, diesel by around 40 cents and illuminating paraffin by 43 cents.
“It is too early to know at what price level oil supply will match demand in the wake of the OPEC decision to cut production,” the AA said, reiterating that it expected 2017 to be a difficult year for motorists.
Thus from January 2017, 93 fuel price will sell at R13.10 as against R12. 59 officially sold in December. While 0.05% Diesel (wholesale) will sell at R11.43 as against R11.03 sold in December.
The rise in fuel price will greatly affect travelers who are expected to return to their homes after the long holiday season. It will also affect food prices and many other commodities.