Fuel prices are set to increase at month-end. This is according to the Automobile Association (AA) which was commenting on the recent exchange rate and commodities data.
“We have noted oil prices spiking above $75 a barrel in recent days, and the upward trend has been evident throughout September. Brent Crude in particular has increased by $10 a barrel in less than a month, and the Mediterranean and Singapore prices used in South African fuel pricing are also in advance. This trend could point towards substantial future fuel price increases,” it adds.
The Rand/US dollar exchange rate was flat for much of the first half of September, with movements in a fairly limited range. However, recent weakening, combined with higher international petroleum prices, could push fuel prices into negative territory by month-end.
“Until government manages domestic policy more effectively, the Rand will continue to expose South Africans to the full brunt of bullish oil prices, meaning South Africans are not getting fuel as cheaply as they could be,” says the Association.
NOTE:
The AA is unable to provide a more detailed outlook for the price movements of fuel for October beyond fluctuations as indicated above as the Department of Mineral Resources and Energy is withholding the daily fuel updates it publishes on the website of the Central Energy Fund (CEF), and through daily emails.
The DMRE has indicated that going forward it will only publish this update at the end of the month at which time the Association will be better placed to comment further.