Johannesburg - Despite the weakening rand, the fuel price outlook for June remains positive, with significant reductions in all fuels likely, says the AA.
Commenting on unaudited mid-month data from the Central Energy Fund, the AA says lower international product prices are the reason behind the predicted decreases.
"The weaker rand/US dollar exchange rate, though, is taking away from the forecast decreases, which would have been more significant had the rand been stronger,“ the AA says.
“As it stands, both grades of petrol are heading for decreases of around R1/l, while the decreases for diesel are currently standing at around R1.30/l. Importantly, the data is showing that illuminating paraffin, which is such an important fuel at this time of the year, is headed for a decrease of around 80c.”
The AA says a decrease in fuel prices is welcome and will bring relief to cash-strapped consumers, which, if realised, would bring prices down to rates last seen in February.
The AA further notes that the decrease is positive and will ease pressure on the economy and consumers.
"Of course, this is only one indicator, and we cannot ignore higher interest rates and food prices, but a decrease in fuel costs will make a difference to many," the AA says.
The association adds that the outlook for June is made mid-month and will change before the adjustment for June is made.
"Nonetheless, we remain confident that significant decreases will be seen in fuel prices for June."
The Star