The Automobile Association (AA) has warned South Africans about a record high fuel price increase coming in April. The Central Energy Fund’s mid-month fuel data release prompted AA’s comment.
Fuel prices may reach R24/l for petrol says AA
The AA noted on Wednesday, 16 March, that the latest information available has projected that fuel prices could reach up to R24/l for petrol and R23.60 for diesel. The current data available shows that 95 octane petrol is set to increase by R2.5/l.
93 octane petrol is expected to rise by R2.07/l, illuminating paraffin is projected to climb by R2.5/l while diesel is expected to increase by between R2.94/l and R3.08/l.
AA says this is the highest in SA’s history
The AA stated that these will be the highest increases in fuel prices in the history of South Africa. Not only will this have major ramifications but the economy as a whole will be undoubtedly impacted.
“We must note, though, that this is the mid-month outlook, and oil prices are, for the moment, see-sawing significantly so there may yet be some relief before the official adjustment by the Department of Mineral Resources and Energy is made going into April,” said the AA.
International oil prices continue to impact the globe
International oil prices have skyrocketed in the past weeks due to the ongoing conflict between Ukraine and Russia. IOL reports that Russia is the third top crude oil producer in the world.
The AA explained that the increase in oil prices contributes about 98% to the predicted hikes. The rand contributes to the other 2%. The rand reportedly stabilised to R15.01 to the US dollar as of 16 March 2022.
The AA revealed that the rand’s value against the US dollar has a nominal impact on the South African fuel price. The association further explained that the globe is seeing record-high fuel prices which will impact every market.
Consumers are advised to brace themselves
It added that there is not much that can be done to stop the dramatic impact.
“Locally there is little to cushion the blow for millions of South Africans who are struggling to cope with a fragile economy which is hurting their personal financial situation. Consumers should brace themselves and prepare for what is likely to be a long winter if the conflict in Ukraine is drawn out.”