Petrol will see an increase of 28 cents and between 1 cent and 9 cents per litre for diesel. Picture: Antoine de Ras.
The month of February for South Africans will be a tough one as economic headwinds will continue for consumers.
This comes after the South African Reserve Bank (Sarb) raised interest rates and the Department of Mineral Resources and Energy confirming fuel prices are set to increase from Wednesday.
Due to the rising oil price, the price of petrol and diesel will be hiked.
Petrol will see an increase of 28 cents and between 1 cent and 9 cents per litre for diesel.
Paraffin will increase by 58c a litre, and the maximum retail price of LP gas will fall by R1.40/kg.
This means motorists in Gauteng will be paying R21.68 for a litre of petrol, while diesel will increase to R21.32 a litre.
At the coast, motorists will see petrol prices increase from R20.45 to R20.73 for the 93 grade of petrol, with the price of 95 moving from R20.75 to R21.03.
The department said that global oil prices increased by just over a dollar in the past month, from $85.08 (R1 481) per barrel to $86.16, with a stronger performing rand unable to stave off a fuel price hike.
“The movement in international refined petroleum product prices, diesel, petrol and illuminating paraffin in particular followed the increasing trend in crude oil prices, while the prices of LP gas decreased due to lower propane and butane prices during the period under review,” the department said.
This can be attributed to China, as the country reopened its economy after strict coronavirus lockdowns had been enforced.
Last week, the Sarb decided to hike its benchmark lending rate for the eighth consecutive time, but this time by only 25 basis points from 7% to 7.25% per annum in a bid to tame elevated consumer prices.
Trade unions have called the latest interest rate hike a “callous decision” that will further impoverish cash-strapped workers, as the cost of borrowing rises.
This rate hike means the cost of borrowing has increased by a cumulative 375 basis points since the normalisation of policy rates began in November 2021.
Trade union Uasa spokesperson Abigail Moyo said workers would feel the pinch after latest repo rate hike.
“Higher prices, a looming electricity tariff increase of nearly three times the current inflation rate in April, combined with higher interest rates bring a walloping double blow to workers’ budgets, shrinking their disposable income even further,” Moyo said.
The Congress of South African Trade Unions (Cosatu) said the National Credit Regulator’s reports attested to the fact that workers were drowning in debt, and still struggling to recover from the Covid-19 pandemic.
The overwhelming 70% of workers who earn less than R5 900 per month are also indebted through loan sharks, as they try to juggle the rising cost of groceries, transport and electricity.
It is not just workers and motorists who will be feeling the pinch, farmers in the agriculture sector have been hit hard due to the on going power cuts in the country.
Many farmers have been faced with higher input costs such as using fuel to power generators to ensure that they are able to continue production, however, with Eskom announcing higher stages of load shedding on Tuesday and an incoming fuel hike, concerns about food security in the country could see further inflated prices at supermarkets.
South Africa’s ruling party, the ANC, has directed the government to declare a national State of Disaster at struggling power utility Eskom in a bid to end the ongoing energy crisis.
This was announced by President Cyril Ramaphosa at the conclusion of the ANC National Executive Committee lekgotla in Kempton Park last night.
BUSINESS REPORT