Economist predicts massive fuel increase in Oct

Sthembiso Sithole

 

 

While consumers will most likely be spared in September,

October promises to be harsh on petrol consumers' pockets.(SABC)

The weakening rand and the spiralling oil price have led to many speculations that the South African motorist is in for a massive fuel price hike. However, Economist Mike Schussler says the September increase, due next week, will be a few cents but cautioned that a massive increase is on the cards for October.

“It is very bleak at the moment for October but as it
all political things, it is very difficult to predict what
is going to happen with the oil price but I think in all likelyhood we are going to see a very big increase in the price of fuel come October, probably 40 to 50 cents.”

Speaking about the on-going strikes action in the country, Schussler says they are not helping the currency.

“I think it is more than just a strike. There is certainly a worry about all emerging markets at the moment. So most emerging markets currently are under pressure. Certainly the strikes are not helping the South African currency.”

The rand has continued to perform badly. The currency hit a new four-year low earlier in the session at 10.51 against the US dollar on Wednesday.

A short while ago the rand was trading at 10.31 to the dollar. The rand's volatility has continued as investors who are nervous about the crisis in Syria continued to sell emerging market currencies.
Click below to listen to Economist Mike Schussler as he predicts the fuel price increase.

This article appeared on the SABCNews website on the 29 August 2013.