Kevin Lings discusses the impact of Wednesday's fuel hike

1. The petrol price for 95 and 93 ULP is expected to rise by 67c/l on 6 September 2017 while the price of diesel will
increase by 44c/l and paraffin will rise by 65c/ l. This latest announcement by the Department of Energy means
consumers will be paying R13.72 per litre (95 Octane ULP Gauteng).
Based on the new CPI weights, this hike in the petrol price will also increase the monthly consumer inflation
rate by a substantial 0.3 percentage points. The increase in the fuel price is due to several factors, including a
weaker Rand/Dollar exchange rate during the last fuel price review period, which increased the fuel price by 3c/l.
The oil price moved higher during the same period, adding 59c/l to the price of fuel. In addition to all this, the
Department of Energy announced a 5c/l increase in the retail margin.
This price increase could start to negatively impact the current favourable outlook for SA inflation and interest
rates. However, it is still expected that inflation will remain inside the target range until the end of 2018,
allowing the Reserve Bank to cut interest rates by 25 basis points over the next six months.
STANLIB is an authorised financial services provider
By: STANLIB Chief Economist, Kevin Lings
Impact of the looming petrol price increase