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Spike in international oil prices could lead to fuel price hike in January - AA


The Automobile Association (AA) has warned that the price of petrol could rise by a substantial amount at the beginning of 2017 if current market trends stay as is.

In a statement, the association said rising international oil prices and indications that countries not part of the  Organisation of the Petroleum Exporting Countries (OPEC) plan on scaling back production, could lead a price increase of 27 cents a litre for petrol and 21 cents for diesel in January.

"If the oil-producing countries adhere to the proposed production cuts, oil prices are likely to strengthen until demand and production move back into equilibrium. Even a stronger rand could be overpowered by a sharp climb in the oil price, potentially meaning a succession of fuel price hikes which could impact the economy strongly over the next few months," News24 quoted the AA's statement as saying.

A short while ago, the national currency was trading at R13.67 to the US Dollar with Brent Crude Oil at $54.96 a barrel.

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