AA forecasts drop in fuel prices in July

Motorists can expect more fuel price decreases in July, says the Automobile Association.

Unaudited mid-month fuel data from the Central Energy Fund (CEF) is indicating that unleaded (ULP) 93 petrol shows the biggest decrease when fuel prices are adjusted on July 3. But the AA says this may change before the official monthly adjustment by the department of mineral resources & energy at the end of the month.

Based on current data, ULP95 is showing a decrease of about R1.10c/l while ULP93 is indicating a decrease of about R1.15c/l. Diesel is edging towards a decrease of 55c/l and illuminating paraffin a drop of about 45c/l.

These decreases would not cause the prices of fuel to drop to levels seen at the beginning of the year, says the AA.

“At this stage of the month, the numbers are more reflective of the way the fuel prices are likely to move when they are adjusted for July. Currently, the trajectory indicates that all fuels will be cheaper in July,” the AA notes.

International product prices remain relatively low, with the price of global oil dropping significantly at the beginning of the month.

The impact of the average rand-US dollar exchange rate for the reporting period must also still be fully factored in, which may move fuel pricing either way.

“These decreases, if materialised, will go a long way to further alleviating the fuel price burden — and its associated impact on other prices — felt by millions of South Africans and is certainly welcome,” says the association.

At the beginning of June the prices of all grades of fuel decreased significantly, with the retail price of 93 and 95 unleaded down by R1.24/l.

The wholesale price of high-sulphur 0.05% diesel dropped by R1.18/l, with low-sulphur 0.005% reducing by R1.09/l.