Another fuel price hike on the cards next week
Another fuel price hike is on the horizon for South African motorists in February, according to the Automobile Association’s analysis of unaudited month-end data.
The AA's Layton Beard says petrol per litre will go up by no less than 80 cents per litre.
"The Association is forecasting that petrol will increase by up to 82 cents a litre, diesel by 59 cents, and illuminating paraffin by 60 cents,” Beard said.
Despite a second global COVID-19 wave which would be expected to result in low oil demand and a subsequent oil price drop this has not been the case as oil prices have continued to rise.
“I think many countries are hedging at the moment and making sure that when the activity does pick up again they have sufficient supplies and reserves. And that will continue to push the oil price higher,” he said.
READ: Former ward councillor, Brandon Pillay takes his place in parliament
The rand dropped to an all-time low of over R19 to the dollar last April and the currency has since appreciated to approximately its pre-COVID-19 level.
"The record low exchange rate, fortunately, went hand-in-hand with record low oil prices, so the impact went largely unnoticed as fuel prices plunged. But economic or policy shocks which weigh on the Rand are likely to have a more significant effect on the fuel price now that international oil prices have rebounded," Beard concluded.
