August will usher in minor savings at the pumps, says AA

Though minor, fuel decreases are expected across the board for August, says the Automobile Association (AA) when commenting on unaudited data from the Central Energy Fund (CEF).

According to CEF data, 95ULP is expected to drop by about 14c/litre and 93ULP by about 9c/l. The wholesale price of diesel is expected to decrease by around 26c/l and the cost of illuminating paraffin by almost 21c/l. 

“The main drivers behind the decreases are a strengthening Rand/US dollar exchange rate and lower international oil prices. The movements in exchange rates contributed most to the trajectory of the fuel prices moving downwards. International product prices dipped slightly from the middle of July, lowering the under-recovery, and resulting in the forecast decreases,” the AA said.

With the expected decreases, consumers filling a 55-litre tank with 95ULP inland will only save a little more than R7, and R4.95 if they fill up with ULP93.

“Naturally we are all looking at ways to manage expenses, and as fuel remains an integral part of many budgets it’s difficult to avoid paying higher prices,” said the AA.

“Our advice is to ensure vehicles are in good mechanical condition and tyres are inflated according to manufacturer’s specifications. A smoking vehicle or one that feels sluggish is also consuming more fuel. Should your vehicle present such symptoms, take it to an AAQA general repairer for a check-up. Old oil, worn spark plugs and dirty air filters will also cause higher fuel consumption. Avoiding heavy traffic, not overloading the vehicle and minimising driving where possible are other ways to reduce use.”

Fuel price review

Earlier this month the AA welcomed the announcement by President Cyril Ramaphosa in his opening address to parliament of a review of the fuel price formula. "At the time we noted this validated our years-long call for a fuel price review to mitigate against rising fuel costs which continue to impact on embattled consumers.

“We also noted the bold step by the president to announce the review should unfold quickly and all role-players in the country’s fuel value chain, including civil society organisations such as the AA, should be part of the discussions. Since the announcement by the president, however, there has been no communication from any department on when and how the review will occur. We again call on government not to lose the momentum and initiate the process as soon as possible, specially since fuel costs play a critical role in many sectors of the economy,” said the AA. 

The official announcement about the adjusted fuel price for August by the department of mineral and petroleum resources is expected on August 5 before the adjustment at midnight on August 7.