Festive fuel drop a holiday bonus
● South Africans could be pumping their money into their summer holidays instead of their petrol tanks, thanks to the recent sharp fuel price decrease.
Motorists cautiously rejoiced at the substantial fuel price drop on Wednesday. It came just in time for travel over the festive period.
Petrol dropped by R1.84 a litre, both at the coast and inland, while a litre of diesel now costs R1.48 less.
Economists and travel agents predict that the fuel price drop will have a positive effect on holiday bookings and retail sales.
“Many can now afford to drive a little extra and take a small break,” said economist Mike Schussler.
“The amount of disposable money back in the economy due to the drop is R3.4bn per month. But remember, that is from a very high petrol price.
“But it means for me that some money will go into retail sales this month — say about half that — some extra into fuel as well and some will become debt repayments or savings even.
“But no doubt that this is a big amount of money that will help retail and local holiday resorts.”
He believes camping sites and B&Bs may see a “slight increase as people can afford a little more”, he said.
“It is probably also the middle- and lower-middle-income groups that will feel the biggest relief.
“Also those that have to drive far to work, say from the West Rand to the East Rand, will have a lot of extra money in their pockets.”
Schussler foresees another fuel drop in January, which could help retail in the new year too.
Thompsons Holidays spokesperson John Ridler said there has been an increase in inquiries and bookings for self-drive holidays in SA since the fuel price drop.
“The good news is that there is still space at affordable hotels in the Western Cape and on the KwaZulu-Natal coast as well as smaller centres around SA,” said Ridler.
The Durban Chamber of Commerce & Industry said the drop in the fuel price would provide relief to South Africans by “freeing up” their disposable income.
“The drop in the price of fuel does create more opportunities for one wanting to travel, especially when finances are a concern,” said chamber president Musa Makhunga.