Fuel price hike weighs heavily

SECOND CONSECUTIVE RISE: MORE SPENDING ON CREDIT

- Ina Opperman

The January fuel price increase is bad news for indebted consumers who are still struggling to make ends meet. This was the second consecutive increase.

The latest increase takes 93 Unleaded petrol from R21.15 in December to R21.34 in January, with 95 Unleaded increasing from R21.47 to R21.59.

The primary drivers of the increase are fluctuations in international oil prices and the depreciation of the rand.

But there is hope on the horizon, with Bloomberg reporting that positioning in the options market suggests the rand is poised for a rebound that may be as steep as its rapid December decline.

This would likely make local products more competitive in the domestic and international markets, while making South African exports more attractive for foreign buyers, spurring improved profitability and economic growth.

However, Neil Roets, CEO of Debt Rescue, said the fuel price increase is very bad news.