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Bad start for 2017! Hefty fuel increase set for January

2016-12-29 11:47

SAVE FUEL: January 2017 will only be the beginning of a series of fuel hikes during the year. Image: iStock

Cape Town - January 2017 will see the first of what the Automobile Association (AA) expects to be a series of fuel price hikes in the new year. The AA said that unaudited month-end fuel price data released by the Central Energy Fund (CEF) showed substantial price increases for all types of fuel.

"The Rand has weakened against the US dollar since mid-December, while international petroleum prices have continued their upward march," the Association said.

Weak Rand, petroleum strength

"However, despite the Rand's recent weakness, it was comparatively strong in the first half of December, and the anticipated fuel price rise is entirely attributable to petroleum strength."

READ: 11 ways to drive fuel efficiently in SA

The AA observed that if international petroleum prices had remained unchanged from November, South African fuel prices would actually have dropped by around two cents a litre in the new year. Instead, petrol is expected to increase by 51 cents a litre, diesel by around 40 cents and illuminating paraffin by 43 cents.

"It is too early to know at what price level oil supply will match demand in the wake of the OPEC decision to cut production," the Association commented, adding that it expected 2017 to be a difficult year for motorists.

READ: Filled-up with the wrong fuel? Here's what SA motorists should do

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