The Citizen reports that according to economists, Wednesday’s fuel price increases will put more pressure on the inflation rate.

Low-income consumers will bear the brunt of the increases as they will pay more for transport, as well as R1.01 per litre more for illuminating paraffin for cooking the little food they can afford. From Wednesday, 95 octane petrol inland will cost R20.14/l with the same fuel costing R19.42/l at the coast. Prof. Jannie Rossouw of the Wits Business School hopes the Department of Mineral Resources and Energy did not make a mistake again with calculating the new price like it happened at the beginning of December last year when an extra 6 cents were added. However, it is difficult to check currently because the department does not share the information on its calculations anymore. Rossouw said the new increases would definitely put upwards pressure on the inflation rate and the question now was what government would do about the fuel levy in the budget later this month. Layton Beard of the Automobile Association commented that the large increase in the price of illuminating paraffin in particular would hit poor people hard, as many of them relied on this fuel for lighting, heating and cooking. Economist Mike Schűssler said he expected the higher diesel price to have a huge impact on prices as everything has to be transported by road as the rail system was not working. He expects the higher fuel price to push inflation over the 6% threshold of the Reserve Bank, which will in turn mean more repo rate increases.

• Read the full original of the report in the above regard by Ina Opperman at The Citizen

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