AA warns of ‘catastrophic’ fuel price hike

The Automobile Association of South Africa (AA) has warned that the October petrol price increases will be catastrophic for South African road users as the country faces the biggest fuel price increase in history, adding that the cost of doing business will go up and consumer disposable income will shrink.

This comes as the unaudited month-end fuel price data released by the Central Energy Fund (CEF) shows that petrol is expected to go up by R1.01 per litre in October, with diesel spiking to a R1.24 increase, with the rand and oil contributing almost equally to the rises.

Excluding months where fuel taxes were hiked, this will be the largest single fuel price increase South Africa has ever experienced. Fuel prices have increased every month this year except for September due to the once-off government’s intervention which contained the increases.

“The major culprit is South Africa’s chaotic economic policy which has left us defenceless against upticks in international oil prices. Illuminating paraffin users are also in for a shock with the price predicted to increase by a whopping R1.05,” AA said.

“We estimate this increase could extract a further R2.5 billion a month in transport costs from an economy that is already on the ropes.” – ANA