Johannesburg - As if South African consumers' budgets aren't already stretched thin, an increase in fuel prices at midnight will force them to dig deeper into their pockets.
The increase means food prices will shoot up in a country where unemployment is already alarmingly high.
Statistics South Africa today announced that the number of people who are not economically active stands at 16.8 million, and now the unemployment rate stands at 32.7%.
Commenting on the data, the Automobile Association (AA) said the numbers are also pointing to increases in the wholesale price of diesel and illuminating paraffin.
According to the data, 93 ULP and 95 ULP petrol prices are expected to rise by between R1.22 and R1.27 per litre, diesel prices are expected to rise by around 28 cents per litre, and illuminating paraffin prices are expected to rise by 16 cents per litre in the new month.
"In the case of petrol, the movement in international oil prices is contributing between 76 and 82 cents to the increases, while the weaker average Rand to US Dollar exchange is adding about 46 cents to the expected increases. In terms of the diesel price, the sole contributor to the expected increases is the weaker exchange rate," said AA.
Based on these numbers, a litre of 95 ULP inland will climb from its current level of R21.68/l to R22.90/l, while the price at the coast will increase from around R21.03/l to R22.25/l.
"The increases to the price of petrol are big and will have a negative impact on household budgets. A 50-litre tank of fuel, for instance, will now cost R61 more to fill, or R244 if filled four times during the month, which is significant. The cumulative effect on personal finances will be a further reduction of disposable incomes, which will be exacerbated by increases to goods and services that must recoup the higher fuel input costs."
"We again urge consumers to monitor their fuel usage carefully and to budget according to the new fuel prices, which come into effect at midnight. Ensuring vehicles are well maintained and in good mechanical condition, carefully planning routes, and avoiding heavy traffic, if possible, are some ways in which motorists can ensure better fuel consumption," said the association.
Consumer debt expert Moeshfieka Botha said consumers are stretched.
"I think South Africans have to realise that we know by now that once petrol, diesel, and fuel costs increase, it's carried over, not only at the fuel pumps, but also carried over into everything else that we consume and everything else that we buy, because it has that ripple effect. So it's definitely not a good thing, and South Africans are really going to have to start cutting down and start budgeting. Because we also have to remember that on April 1, 2023, the 18.65% Eskom increase also comes into effect," said Botha.
The Star