The recent petrol price hike is just the beginning of a series of increases, predict economists and industry experts.
|||Cape Town - Tuesday night’s petrol price hike is just the beginning of a series of increases, economists and industry experts predict.
Both 93 and 95 octane grades of petrol went up 41c/litre - rising to R11.92/litre. Diesel went up 17.8c/litre. Liquid petroleum gas went up a whopping 73 cents/kg.
The year could be a difficult time for South Africa as petrol prices are estimated to rise to between R13 and R14 a litre by the end of the year.
Nedbank economist Isaac Mot- shega said the rapid inflation of petrol prices was inevitable.
“Global fuel prices are very sticky and I don’t see them dropping any time soon.”
Rising tensions in the Middle East have seen US WTI crude oil test the $100-a-barrel mark, while Brent crude has risen to just over $115 a barrel in the past week.
Motshega said this, coupled with poor performance by South African exports - ultimately weakening the rand exchange rate - had resulted in the current increase.
Automobile Association spokesman Gary Ronald said prices could exceed R13 or even R14 a litre, depending on politics and the US economy.
But Efficient Group chief economist Dawie Roodt disagreed. While he did anticipate another increase over the next few months, which would be “ugly” and possibly eclipse this month’s increase, Roodt said petrol prices would have settled down by the end of the year.
The poor rand exchange rate accounted for only six to seven cents of last night’s increase; the global fuel market was responsible for most of the hike.
Roodt predicted this year’s total increase in petrol prices would be less than the R1.35 a litre seen last year.
Consumer watchdog Ina Wilken said the increased petrol price would push up costs across the board, and she advised South Africans once again to “tighten their belts”.
“Every commodity is transported by plane, car or truck which means everything is going to cost more,” she said.
Meanwhile, the city’s Transport Department has been encouraging commuters to “consider their transport and mobility habits” in the light of the fuel hike - urging people to walk or cycle and to consider minimising their reliance on private vehicles.
The city said the current transport infrastructure was “under increasing pressure” - which meant longer peak periods, worse congestion and increasing costs.
“The cost of travelling on public transport is a fraction of the cost of running a private car. Another consideration is that public transport costs increase only once a year - not whenever there is a rise in the price of fuel,” the city said.
The introduction of the MyCiTi bus system should alleviate traffic congestion.
The original bus routes have been operational since June 2010 and about 12 500 people use the service each day, said Brett Herron, mayoral committee member for transport, roads and stormwater.
Many of the peak-hour buses were now full, said Herron.
“It is simply not sustainable for the number of single occupancy vehicles that are on the road to continue to grow.
“We will continue to prio-ritise public transport over private car usage.”
However, Ronald said car usage was increasing: “The fuel price to date has not been a factor on reducing vehicle usage.”
He said that if the fuel price continued to increase and public transport was “jacked up significantly” there might be some reduction in traffic.
Ronald added: “We should be looking at cleaner fuel so that we can take advantage of technologies used abroad.”
kieran.legg@inl.co.za,
natasha.prince@inl.co.za
Cape Argus