/ 17 April 2007

SA faces new hike in fuel prices

Motorists should brace for another big hike in petrol prices next month of up to 40c a litre, according to Business Report on Tuesday.

Motorists swallowed the country’s biggest fuel price rise of 68c in April.

Rampant oil prices are the culprit, with upward price pressure expected to continue until next month, the paper said.

The Department of Minerals and Energy’s average under-recovery for half of April stood at 36,5c a litre for petrol, around 32c a litre for both types of diesel and 21,8c a litre for illuminating paraffin.

The paper quoted Econometrix economist Tony Twine as saying that a 5% increase in the petrol price would add 25 basis points to the prevailing inflation rate.

T-Sec economist Mike Schussler told the paper the increase in the fuel price would also bring a rise in food prices. – Sapa