South African motorists can expect a welcome relief in August, as the price of petrol is expected to drop significantly, according to the Automobile Association (AA).
The association was commenting on unaudited mid-month data released by the Central Energy Fund (CEF).
It said that rand strength and oil weakness in the wake of the United Kingdom’s vote to exit the European Union, would likely push down the price of petrol for the first time in several months.
“After initially weakening in the wake of the UK referendum result in late-June, the Rand has since strengthened steadily,” the AA said.
“At the same time, international petroleum prices have retreated on concerns over economic uncertainty following the vote. As a result, fuel prices are showing favourable gains.”
The mid-month data sees petrol poised for a drop of as much as 83 cents a litre, with diesel set for a reduction of 45 cents and illuminating paraffin a reduction of 42 cents a litre.
“Despite this positive picture, predicting the likely position at the end of July remains complex,” the association said.
“The underlying trend has been towards higher fuel prices over the past months as the rand weakened and international oil prices climbed. It is not yet clear what effect recent events will have on this trend, and it would be premature to assume it has been disrupted.” it said.
The table below shows what the petrol price and wholesale price of diesel is expected to be in July.
|Fuel||July Inland||Expected August|
|0.05% Diesel (wholesale)||R11.70||R11.25|
Source: Business Tech