Hikes in the petrol price will impact negatively on motorists’ and commuters’ disposable income, the Automobile Association (AA) of South Africa warned on Monday.
”The impact of the highest fuel prices ever in the history of transport in South Africa will without doubt be felt on the supermarket shelves within the next six to eight weeks as freight costs are passed on to the consumer,” the AA said in a statement.
The price of petrol will increase by a record 66 cents and 68 cents per litre at midnight on Tuesday April 1 2008, while the wholesale price for diesel is set to increase by R1.30 cents per litre. Illuminating paraffin will increase by R1,18 cents per litre.
Motorists will for the first time be paying in excess of R8,80 per litre of petrol in Gauteng, the AA said.
”Coupled with the continued increase of the CPIX [consumer inflation less mortgage costs] and PPI [producer price inflation], consumers are cautioned to expect further increases in the cost of living due to the escalating price of fuel,” it said.
The bulk of the increase is a result of the increase in international product prices, with crude oil trading at about the $105 per barrel, combined with a weaker rand. The average rand/dollar exchange rate for March was R7,99.
The AA said that in addition, the increase of R0,05 to the Road Accident Fund and R0,06 to the fuel levy, as provided for in Finance Minister Trevor Manuel’s budget speech, will be effective from April 1 2008.
”The rapidly escalating price of diesel, in particular, can be ascribed to global demand outstripping supply. Locally, Eskom is utilising diesel to power some of its generators and this has increased the demand substantially.”
In addition, general transport costs will be increased and passed on to the consumer.
”We expect to see an increase in the commodity prices at the till. Hardest hit will be people with limited financial resources,” the AA said. — Sapa