South Africa is bracing for a significant surge in fuel prices come March, with the Automobile Association (AA) issuing a warning that the cost per litre may breach the R24 mark, nearing the record-high R25 experienced last year. The mid-month fuel data released by the Central Energy Fund (CEF) has prompted the AA to express deep concern over the potential strain on consumers already grappling with economic challenges.
According to the AA’s analysis of the current data, the projected increases indicate a substantial rise in fuel prices. Specifically, 95 octane petrol is anticipated to witness a hike of R1.35 per litre, while 93 octane could climb by R1.31 per litre. Diesel prices are expected to surge between R1.43 and R1.59 per litre, with illuminating paraffin facing an increase of 96 cents per litre.
The international market plays a pivotal role in these anticipated fuel hikes, with soaring global product prices significantly contributing to the upward trajectory. Additionally, the fluctuating Rand/US Dollar exchange rate is cited as a marginal factor influencing the under-recovery of basic fuel prices.
Expressing their concern, the AA emphasizes the potential strain these increases could exert on already burdened consumers. The organization calls for a thorough review of the current fuel pricing model by the Department of Mineral Resources and Energy (DMRE) to identify possible adjustments that could help alleviate rising costs. Particularly, the AA highlights the need for consideration of diesel prices, emphasizing the necessity of mitigating higher input costs reflected at the pumps.
Furthermore, the AA urges the Minister of Finance to refrain from increasing the General Fuel and Road Accident Fund levies in the upcoming Budget Speech on February 21. Any form of relief, even in the absence of increases, is deemed crucial to easing the financial burden on a consumer base already grappling with economic hardships.
As South Africans await the final decision on fuel prices, concerns grow over the potential ripple effect on the broader economy and the daily lives of citizens. The looming fuel price shock adds another layer of complexity to the challenges faced by individuals and businesses, underscoring the need for proactive measures to mitigate the impact on the nation’s economic landscape.
Tags: AA Automobile Association