Cape Town - Motorists should brace themselves for another massive fuel price increase on Wednesday.
The AA said strong oil prices and an ever-weakening rand have led to another fuel price hike.
This is confirmed by the unaudited month-end fuel price data released by the Central Energy Fund.
“These increases will be compounded by rises in fuel taxes which come into effect in April.
“There will be an additional increase of 15c for the fuel levy and 5c for the RAF levy (which don’t apply to illuminating paraffin),” the AA said.
The Energy Department announced that the price of 95 octane petrol will increase by R1.31 a litre for inland provinces, while motorists on the coast will have to fork out R1.26 more, 93 unleaded increases by R1.34 a litre for landlocked regions and R1.29 at the coast. Diesel will increase by between 81c and 82c a litre.
The AA said that it is concerned about the rand’s trajectory.
“The currency’s slide might reflect an accelerating loss of appetite for foreign direct investment in South Africa. We urgently call on the government to take concrete steps to address the economic weaknesses which are affecting the country’s attractiveness to foreign capital,” it said.
Economists have raised concerns about the fuel price affecting the growth of the economy.
“This will most likely result in inflation rising and will also cause a massive strain on our economy because interest rates won’t be going down,” economist Mike Schüssler said.
He said the rise in fuel prices comes at a difficult time when the economy struggled with load shedding.
Electricity prices are also expected to go up this month.
Last month the National Energy Regulator had allowed Eskom to implement a 9.4% increase in an attempt to rescue the cash-strapped utility from going insolvent.
Economist Dawie Roodt warned that this was likely to create fertile conditions for investor uncertainty.
“This will affect the growth of the economy. As a result of these tough times, poverty is also more likely to increase and it’s going to be hard for the average consumer.
“I am not very optimistic that this will end after the elections,” Roodt said.
Cape Chamber of Commerce president Geoff Jacobs said GDP performance is poor - and way behind what the NDP was based on.
“How are we supposed to boost the economy when the very cost of doing that has increased?
“Compounded by the drought and the energy crisis, it is very difficult for business to step up to the plate,” Jacobs said.
@MarvinCharles17