The Automobile Association says South African motorists can expect the price of petrol to increase at the start of August, with the price of diesel set to fall.
The AA was commenting on unaudited month-end fuel price data released by the Central Energy Fund.
"International oil prices have steadily trended upwards since the start of June, although there has been a slight pullback since a peak on July 11. Since then, diesel prices have edged higher while petrol remained flat, although the currency remains volatile going forward, particularly in light of recent ratings agency announcements and other factors," the AA said.
According to the latest figures, the AA forecasted petrol would increase by around 12 cents a litre and diesel would fall by approximately 16 cents a litre. The price of illuminating paraffin, meanwhile, was also likely to fall (by eight cents a litre).
The Association said oil volatility was “likely to continue”, but that many competing factors were in play, such as US inventory levels, political instability in the Middle East, a possible medium-term demand plateau, and ongoing OPEC output restrictions.
"Medium-term oil price forecasts remain subject to considerable uncertainty, as does the rand against the Greenback," the AA said.
"The average rand/dollar exchange rate crossed R14,20 last week despite spending much of July stronger against the US currency. This volatility can come into play before Wednesday’s adjustment and may even have a bearing on the September outlook," the Association noted.
The AA cautioned that South African fuel-users would “remain vulnerable” to the country's “difficult economic position” and the vagaries of the international oil price.
"Anything which shocks oil higher or the rand weaker has the potential to cause sharp fuel price increases," it said.
Original article from Car