Hefty Fuel Price Hikes to Hit Consumers in April

April Fuel Price Hike

Ongoing fuel price hikes will snowball, as a 30c-per-litre fuel levy hike is lobbed on. This will make for a very large hike in April says the Automobile Association (AA).

The 30c levy included, petrol will soar by +/-83c per litre and diesel by +/-95c per litre warned the AA yesterday, responding to the Central Energy Fund (CEF) releasing unaudited month-end data.

Even though the rand has strengthened against the US dollar over the last couple of weeks, the fuel price hike will outstrip these gains.

 

Oil Prices Climb

Moreover, as oil prices continue climbing, South African consumers will be hit with ongoing fuel price hikes. The rand may deteriorate as a result, applying even more pressure. Add to this the possibility of a ratings downgrade before end 2016, and consumers are in for a rough ride with ever more fuel price hikes.

The government has done us no favours by hiking the fuel levy, on top of the monthly adjustment and rising oil prices. A month or so back, oil cost $30 a barrel. It has since soared to +/-$40, which is a large percentage increase. The rand is a long way off from recovering the losses it’s made and remains relatively weak. This, of course, means oil costs a lot more for South Africa.

 

High Cost of Living

This latest fuel price hike will lift the high cost of living even further out of reach. Households have recently taken a string of knocks, with interest rate hikes, electricity tariff hikes, tax increases and food price increases to name but a few.

Iran will be producing an additional 1 million barrels of oil daily, but this does little in the way of bolstering demand in a slow global economy.

The only answer seems to be that of living within our means. This is something the government itself needs to learn. Just because you would like something new, doesn’t mean you should go out and get it on credit. Especially now, as yet another interest rate hike looms.

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