The Cape Chamber of Commerce and Industry said it was disappointed, but not surprised, with the increase in fuel prices. Photo: Courtney Africa/African News Agency (ANA)
The Cape Chamber of Commerce and Industry said it was disappointed, but not surprised, with the increase in fuel prices. Photo: Courtney Africa/African News Agency (ANA)
Golden Arrow bus service said it would not as yet consider an adjustment to its current fare prices despite the fuel price increases. File Photo: IOL
Golden Arrow bus service said it would not as yet consider an adjustment to its current fare prices despite the fuel price increases. File Photo: IOL

CAPE TOWN – The fuel price hike announced by the Department of Energy on Monday, which has been described as catastrophic by many, came as no surprise to most organisations, albeit met with disappointment.

The Automobile Association (AA) said the fuel price hike would extract R2.5 billion a month in transport costs from an economy that was already on the ropes.

“Excluding months where fuel taxes were hiked, this will be the largest single fuel price increase South Africa has ever experienced,” the AA said. 

Trade union Uasa said in a statement on Monday that the latest fuel price increase was the final straw crippling South Africa’s workers.

Andre Venter, Uasa spokesperson said: “As from Wednesday workers will not only fork out for the most expensive fuel price ever but will also have to deal with the ripple effect on the cost of transport – taking them to work and back, as well as the inevitable increase in food prices and other household necessities.”

Venter said attributing the increase to the weakening rand exchange rate would solve no ordinary South African worker’s financial distress. Here Uasa is in agreement with the AA’s opinion that the spike was rather the result of the country's economic policy which had left South Africans defenceless against upticks in international oil prices.

“The department’s ridiculous intervention trick in September to provide relief against fuel price hikes by increasing the price by just 4.9c per litre has now exploded in the faces of the workers on whom the economy rests,” said Venter.

Golden Arrow bus service said it would not as yet consider an adjustment to its current fare prices despite the fuel price increases. File Photo: IOL
Golden Arrow bus service said it would not as yet consider an adjustment to its current fare prices despite the fuel price increases. File Photo: IOL


Little compensation

In what may be seen as little compensation to consumers Golden Arrow bus service said it would not as yet consider an adjustment to its current fare prices despite the fuel price increases.

“Fuel constitutes one of the main costs of our business and rising fuel costs, unfortunately, does have a negative impact on our ability to keep fare prices down. While Golden Arrow will do everything possible to absorb these increases, it may become necessary in the coming months to review current fare prices should this trend continue,” the company said in the statement on Monday.

The Cape Chamber of Commerce and Industry said it was disappointed, but not surprised, with the increase in fuel prices.

Janine Myburgh, president of the Cape Chamber of Commerce and Industry said: “Unfortunately this is to be expected with the weakened rand and the crude oil increase – a situation that we predicted early September that might result in a shocking increase.”

Myburgh said much of the damage has unfortunately been self-inflicted with widespread corruption, mismanagement of state-owned enterprises and the looming expropriation issue not engendering any confidence in investors.

“South Africa has so much potential, yet we seem to be pushing down on the accelerator, hoping to go faster, yet pushing as hard as we can on the brakes at the same time. The result is that we are going nowhere,” Ms Myburgh said.

BUSINESS REPORT ONLINE