Price hike predicted for February

The Automobile Association (AA) has just announced an expected spike in the fuel price for February.

The association said expects petrol to rise by up to 82 cents a litre, diesel by 59 cents, and illuminating paraffin by 60 cents.

“Unfortunately our midmonth concerns over the advancing oil price have been borne out in practice. There has been a slow but steady rise in the price of oil, which is likely to cause ongoing pain at the pumps. Almost all of the fuel price increases reflected by this month’s data are attributable to the stronger oil price, and the average rand/US dollar exchange rate has remained generally flat for the month, despite some large daily swings.”

The AA noted that the drop in the exchange rate concurred with a drop in oil prices, “so the impact went largely unnoticed as fuel prices plunged. But economic or policy shocks that weigh on the rand are likely to have a more significant effect on the fuel price now that international oil prices have rebounded.”