Economists warn of knock-on effect of latest fuel price hike

This follows the announcement by the Energy Department on Friday afternoon, that petrol will cost 82 cents more per litre from 6 June.

Petrol pumps at BP garage. Picture: EWN.

JOHANNESBURG - Economists are warning the latest petrol price increases are likely to have a knock-on effect on the cost of other goods and services.

This follows the announcement by the Energy Department on Friday afternoon, that petrol will cost 82 cents more per litre from 6 June. Motorists will have to pay 85 cents more for diesel, while illuminating paraffin is going up R1,09 cents.

Economist Thabi Leoka says this will inevitably lead to other hikes.

“As we know transport costs, transport of goods, especially food products, will increase because of the petrol price hike.”

Nedbank economist Dennis Dykes says consumers will feel the pinch.

“There are international factors that, unfortunately, will influence inflation, which ultimately means interest rates won’t come off again in the short term as well. This will have all sort of knock-on effects on consumers.”

LISTEN: The knock-on effect of rising fuel prices

(Edited by Zamangwane Shange)