Mixed outlook for fuel prices in December – AA

Current unaudited data from the Central Energy Fund (CEF) is indicating a mixed bag of increases and decreases to fuel prices for December, according to the Automobile Association (AA). The Association says the data is indicating significant increases to petrol prices of between 97c/litre and R1.09/l, but a decrease of up to 34c/l for diesel next month. Illuminating paraffin is also expected to increase by around 30c/l.

According to the data, the average upward movement in international product prices is the main driver behind the increase to petrol prices while the slight downward trend in international diesel product prices is having the reverse impact on this fuel. The Rand is performing stronger against the US Dollar in daily trading – especially since the second week of November – which is having a positive impact on fuel prices.

“With these expected increases to petrol, the price of a litre of 95ULP, for instance, will climb to just under R24/l which will be way below the high of R26.74/l seen in July, but which will still be higher than September, October, and November prices. The decrease to diesel is, of course, welcome and should, at least, not immediately negatively impact other prices reliant on diesel as an input cost. Of course, the increase to illuminating paraffin remains a concern as it will affect the poor most,” says the AA.

The Association says it must be noted that these are mid-month figures and are likely to change before the final adjustment for December is made later in the month.

“However, increases to petrol prices are almost certain to happen while decreases to diesel are also almost a certainty. Given that many people will be travelling by vehicle in December we advise motorists to carefully plan their budgets now to ensure they have the necessary funds to cover their expenses, which may also include toll fees on certain routes,” notes the AA.

In addition, the AA says planning for year-end trips must include ensuring vehicles are good condition.

“A vehicle which is in a good condition will use the optimal amount of fuel and will, in the long run, be more economical than a vehicle that has not been serviced or maintained. Another critical component to check is tyres; not only are tyres which are in poor condition a major safety risk, but they may also contribute to lower fuel economy if they are not properly aligned, or under- or over-inflated. This applies to all vehicles including trailers and caravans which are towed,” concludes the Association.

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