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Petrol price increase for May

03.05.2016

The favourable gains to the Rand/US dollar exchange rate have been brushed aside by the steady increase in the international petroleum prices during April.

This means more fuel price hikes in May, according to the Automobile Association (AA).

"The exchange rate showed a creditable strengthening during April," the AA said. "With a flat oil price, consumers could have expected the price of fuel to drop by up to 29 cents a litre. But the recent increase in international product prices means that diesel will only drop by three to four cents a litre, with a nine cent drop on the cards for illuminating paraffin."

The 42 cents a litre increase in the landed price of petrol surpassed the exchange rate’s strength, meaning petrol users will be forking out an extra 12 cents a litre.

"International petroleum prices have settled into a pattern of gains which are not always being overcome by recent Rand strength against the dollar," the AA commented.

"We forecast steady rises in the price of fuel in South Africa in the short to medium term, with the possibility of larger spikes if the Rand comes under pressure," the Association concluded. 

Article written by Autodealer
03.05.2016
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