South Africans could soon pay between R25 and R27 for a litre petrol, warns economist
An economist has warned that oil could soon hit $185 a barrel as a result of global supply constraints.
Senior economist at Efficient Group, Dr Francois Stofberg says this would result in a direct increase of R5-R7 per litre of oil.
"The real impact that you're probably going to feel, of course, is in your own pocket as a consumer if these oil prices continue to soar like they been doing now.
"Then you'll see R4 to R5 increases easily to the petrol price if we reach $185 a barrel and of course, that would hurt tremendously if you are already R21/R22 where you be paying R25 to R27 that is a 25% additional increase in the prices you're paying."
READ: SA fuel prices ‘set to soar’ following Russia attack on Ukraine
Global oil prices have seen a significant increase in a short space of time since the invasion of Ukraine by the Russian Military.
Stofberg adds that the cost of the rising fuel prices does not directly translate into higher food prices.
"Fortunately, petrol prices constitute a small share of the average household. You can consider the impact on producer oil prices and there the impact would be better. Not all producer prices translate into higher consumer prices."
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