The five-month trend of fuel price decreases is set to end in November, according to the latest unaudited data released by the Central Energy Fund.
The AA said on Wednesday that it expected the first fuel price increase since May to be implemented in November on the back of higher international product prices and a steady softening of the rand against the dollar as indicated in the data.
According to the CEF’s figures, ULP95 is expected to be slightly more expensive by around 14 cents a litre, while ULP93 is set to increase by about three cents/l. Diesel is expected to increase by between 14 cents and 13 cents/l while illuminating paraffin will increase by around seven cents a litre.
“Lower stable fuel prices play a crucial role in the decrease of inflation and in lowering of the prices of goods and services,” said the AA.
“It would greatly benefit our economy if the fuel price decrease trajectory continued for longer but the expected increase, though marginal at this stage, comes at a time when most consumers and motorists are still struggling financially, and any increase now will add pressure on them.”
The AA said the CEF data indicated that the expected increases in this cycle were a result of a sharp rise in international product prices from the beginning of October, and the steady weakening of the rand against the dollar – both key metrics in determining local fuel pricing.
“Due to the tensions which are ramping up in the Middle East, the local currency could be under significant pressure going into the last two weeks of October, and this could have a more significant impact on local fuel prices in November. At this stage it is important to keep an eye on that indicator as we head into the new month,” said the AA.
The official announcement of the November fuel price adjustment by the Department of Mineral Resources and Energy is expected by 4 November, and adjusted fuel prices come into effect on 6 November.
The AA added that the mid-month review of the CEF data pricing was likely to change before then, but that it expected fuel to be more expensive in November than it was currently.
