JOHANNESBURG – Economist Fanie Brink has warned of major fuel hikes in December due to the weakening exchange rate and progressive price rise of crude oil.
Brink says the latest downgrades of the rand by Fitch on Thursday and Standard and Poor’s Global on Friday last week has put the country’s economy under sub-investment standard and will negatively impact the economy.
The Department of Energy has indicated that the price of gasoline (ULP & LRP) is likely to increase by 71,9 cents whilst the price of diesel could see a 61,1 cent price hike.
Economists say the situation could be worse, if the government fails to put effective measures to restore investor and business confidence and restore back the value of the rand.
Oversees analysts also highlighted colossal price hikes in brent crude oil which they say has surged to its highest level since June 2015 when it costed $64,27 a barrel.
On this rate, the average international price of gasoline is likely to increase by 45,7 cents per litre, whilst the price of diesel could see an increase by 34,3 cents per litre.
Brink has blamed the political instability in the country that has led to further economic deterioration and further downgrades by global rating agencies.
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