Oil plunge springs relief for motorists at the pump with petrol price drop
The world might currently be at the mercy of the coronavirus, but South African motorists can breathe a sigh of relief as the Automobile Association (AA) announced a much-welcomed decrease in fuel prices.
The effects of the virus is not only having a devastating impact on human health, but also on the various economies and world markets. It is expected that the price of petrol will drop by up to R1.11 a litre, diesel by R1.10, and illuminating paraffin by R1.18.
The AA says: "As the spread of the COVID-19 virus accelerates across the globe, world financial markets have plunged, with capital fleeing to safe-haven assets. The Rand has been sharply weaker against the dollar on this trend.
"However, this has happened side-by-side with Saudi Arabia's decision to break ranks with OPEC. Not only has Saudi Arabia slashed its crude prices, it has also increased production substantially."
An even keel
As things stand there is currently no endgame to the epidemic as the spread has already made its way to South Africa. The huge drop in oil, though, is one of the biggest so far.
The AA further notes: "The last time oil prices dropped this suddenly was in the first Gulf War, almost 30 years ago. There is little indication of what the final picture of COVID-19 spread will be, nor where the Rand will stabilise against the dollar.
"It will take quite some time for the global economy to get back on an even keel after the current ongoing events, and the next two or three months seem set to provide some fuel price relief to hard-pressed motorists."
Image: Getty Images
Compiled by: Robin Classen