Motorists may soon breathe a sigh of relief, as despite the volatile rand and concerns around shipping routes in the Red Sea, local fuel prices are still expected to decrease when they are adjusted by the Department of Mineral Resources and Energy next Wednesday.
This is according to the AA as they commented on unaudited data from the Central Energy Fund (CEF).
They said the numbers were still pointing to reductions in fuel prices across the board.
According to the CEF’s figures, ULP95 petrol is expected to be lower by around 54 cents a litre, while ULP93 is set for a drop of about 39c/litre. Diesel prices are expected to drop substantially by between 94c/litre and R1.02c/litre, while illuminating paraffin will drop by about 95c/litre.
The AA said on Wednesday that oil prices had stabilised, with some major shippers resuming passage following continued attacks which pushed oil prices higher.
“However, the downward movement in international product prices – oil prices – remains the main driver behind the expected decreases. The average rand/US dollar exchange is playing a smaller role but is still contributing to the expected decreases.
“Although we are expecting fuel to be cheaper in January, we remain concerned about the overall high prices which impact on all consumers. If the expected decreases are realised, petrol prices will still be higher than they were in January 2023, but diesel prices will be marginally cheaper than at the same time. We must see all of this in the context of consumers who are still recovering from steep fuel price hikes in September and October,” said the association.
The AA added that while 2024 is starting on a positive note for consumers, it’s still too early to determine if the trend to lower prices will continue, especially given current geopolitical developments which affect international oil prices.
“For this reason, a sustainable solution to mitigating rising fuel costs is still necessary and until that solution is found, citizens will be at the mercy of fuel price hikes. We again call on government to urgently initiate a transparent review of the fuel pricing structure to seek this solution.”
The AA said changes to this data are expected before the formal announcement by the DMRE ahead of Wednesday’s adjustment. However, it said “any relief at this stage is welcome”.