South African motorists may see some relief at the pumps as local fuel prices are expected to decrease at the start of the new year.
On Thursday, the Automobile Association (AA) announced that the 95 unleaded petrol could come down by about 54 cents a litre while the 93 unleaded fuel could drop by 39c.
Diesel prices are also expected to fall by between 94c per litre and R1.02c per litre, while illuminating paraffin will decline by about 95c/l.
Despite the chances of lower prices in January, petrol prices have not yet fallen below figures seen a year ago.
Red Sea shipping routes
While concerns over the security of Red Sea shipping routes and fluctuating rand value have persisted, the association said the primary driver behind the expected fuel price decrease remains the downward movement in international oil prices.
Oil prices have recently stabilised, and some major shippers have resumed their operations, which has helped to alleviate some of the upward pressure on prices, said the AA.
However, the AA remains cautious, noting that while January appears to be a positive start to the new year for consumers, it is too early to predict whether this trend towards lower prices will persist.
It pointed to current geopolitical developments that continue to impact international oil prices, highlighting the need for a sustainable solution to mitigate rising fuel costs.
Even with the anticipated decreases, the AA emphasised that petrol prices will still be higher than in January 2023.
Diesel prices, on the other hand, are expected to be marginally cheaper than they were at the same time in 2022.
Review of fuel pricing system
The association acknowledged that this situation is particularly challenging for consumers still recovering from high fuel price hikes in September and October.
The AA has called on the government to urgently initiate a transparent review of the fuel pricing structure to find a long-term solution to address the issue of rising fuel costs.
It stressed that citizens are at the mercy of fuel price fluctuations until such a solution is found.
“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,” said the AA.
“We again call on the government to urgently initiate a transparent review of the fuel pricing structure to seek this solution.”
