R1.20 petrol price increase expected for October

The petrol price is expected to increase by around R1.20-R1.30 per litre in October 2018, with additional increases expected in November and December.

Economist Dawie Roodt said it was highly unlikely that this price increase is based on the existing formula used by the energy department to calculate under or over-recovery.

“That is going to further stress out highly-indebted consumers and add to the already negative economic sentiment created by the land expropriation issue and other pending issues like widespread corruption and state capture,” said Roodt.

“It could even be the last nail in the coffin when the ratings agencies announce their latest ratings for South Africa’s sovereign debt.”

Debt Rescue CEO Neil Roets said this latest increase could have a drastic effect on indebted consumers, causing a full-scale recession.

“We keep saying that consumers, who collectively owe more than R1.7-trillion in outstanding debt, literally have reached the end of their tether – but this is definitely the straw that is going to break the camel’s back,” Roets said.

Now read: Expect bigger petrol price increases following government intervention

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R1.20 petrol price increase expected for October