Johannesubrg - The financial burden on consumers is likely to get worse before it gets better.
Petrol prices could rise by 26 cents a litre by the end of the month, the AA said on Tuesday.
The head of public affairs at the AA, Marius Luyt, said the prediction of a 26c/l increase came from unaudited daily fuel price data released by the Central Energy Fund on Monday.
“There has been a slow, but steady uptick in the rand/US dollar exchange rate since the start of this month,” he said.
“Over the same period, international petroleum prices have come off their mid-June highs, but not enough to offset the under-recovery in the petrol price.”
Economist Mike Schussler said yesterday that although oil prices had dropped, it wouldn’t be in time to affect the rise in fuel prices this month.
“The increase in inflation has demolished the spending power of people.
“Consumers and industries are increasingly under pressure.
“This is going to be a major issue for all of us,” he said.
Schussler said the rise in the fuel price was like a hidden tax. “It is not something we can avoid spending on.
“It is difficult to spend less on petrol as we still need to get to work, but people might stop making trips to restaurants and other luxuries,” he said.
The rise in fuel prices, Schussler said, would ultimately have an impact on business, possibly leading to unemployment.
“We are also likely to see a higher interest rate by the end of this year, partly due to the increasing petrol prices,” he said.
The AA said diesel was showing a more favourable outlook, with data predicting a slight price increase of about 3.5c/l.
Illuminating paraffin was also fairly stable, with an increase of about 4.5c/l on the horizon.
PRICE HIKES THIS YEAR
- This year, the petrol price started off at R13.20 a litre for 95 octane unleaded on the coast.
- In February, it went up by 33 cents.
- In March, it went up 3 cents and by another 36 cents in April.
- The price decreased by 15 cents in May and by 22 cents last month.
- At the start of this month, it jumped up by 31 cents, bringing it to R13.92.