Another petrol price hike looming

Cape Town – The soaring price of petrol has left long-suffering motorists reeling and August will be no different with another hike in the offing.

It is expected that fuel will rise by between 20 and 30 cents a litre on August 7.

Economist Dawie Roodt told Fin24 that the stronger rand is curbing a steeper increase. He said the reason for the continuous increase is mostly because of a higher oil price.

Mike Schussler from Economists.co.za agreed with Roodt.

“The rand more than oil prices have been driving recent changes and I think the rand may stay a little stronger for a few weeks.

“I believe we will be a little lucky as the rand has made a bit of a comeback in the last week or so and we may only get about 25 cent increase in petrol and slightly less for diesel,” he said.

The current under recovery on Thursday was 28 cents average for the month but the daily price indicated an over recovery of 9 cent.

“This should indicate that the increase will be less than 30 cents and more likely closer to 25 cents depending on the price movements in the next few days,” he said.

Motorists have endured a series of petrol price hikes since the year started.

In July, motorists had to fork out an extra 84 cents a litre for petrol and 78 cents a litre for diesel.

The price of Octane 5 increased to R13.23/litre in Gauteng and R12.86/litre at the coast, while both grades of diesel increased by 78.20c/litre.

The petrol price increase will also filter through to the cost of consumer goods and services.

“A further petrol price hike will push alot of consumers over the edge, causing them to become over-indebted,” said debt expert Neil Roets.

“Consumers simply cannot afford another petrol price increase.”

He added that almost half of all credit-active consumers are already in arrears with at least three installments on one of their accounts.

South African fuel prices are calculated on an import parity basis.

The formula is based on fuel prices at refineries in Italy, Singapore and the Arabian Gulf.

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