The ANC asking itself for help with unbearable petrol price hikes

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In a media statement released late on 4 June, the ruling African National Congress (ANC) made an impassioned plea to the government of South Africa for its assistance in alleviating excessive financial pressure caused by recent petrol price hikes.

ANC national spokesperson, Pule Mabe, issued the statement following widespread consumer outrage levelled at recent record high petrol prices, with further increases expected in August.

The statement called on governmental powers, reading:

“The ANC led government must mitigate the short and long-term effects the fuel price hikes have on South Africans and our economy.”

Petrol price hikes: What the ANC wants government to do about it

  • Increase petrol reserves
  • Freezing or decreasing the fuel levy
  • Stabilize governance and finances at the Road Accident Fund, PetroSA and Central Energy Fund

The ANC’s statement regarding unbearable petrol price increases points blame to a weakening rand, and rising global prices of crude oil spurred on by American trade wars.

Addressing the United States of America, the statement says:

“We however call on the United States to consider the unintended consequences of its trade wars and the ripple effects its imposition of sanctions on some oil producing countries have on emerging economies.”

The ANC expressed their deep concern for the country’s waning economy, noting that fuel hikes impact negatively on economic growth and continue to put low-income households under greater financial pressure, noting:

“The rate at which these cost increases are happening is unbearable and we can neither turn a blind eye nor wish them away. We need to take strong action to arrest this situation.”

Petrol price hikes: The ANC versus the Facts

South Africans are currently paying more for fuel than ever before, and while the ANC blames this on a poor exchange rate, US trade wars and unaffordable crude oil; the facts paint a different picture.

A barrel of crude oil on the global market currently costs $78, whereas four years ago, in 2014, that same barrel cost $110 for most of the year.

When looking at the rand/dollar exchange rate in context, during 2016, the rand was often R2 to R3 weaker against the dollar than it is now.

While admittedly signs are pointing to a weakening economy and waning international investor confidence, the government taxes on fuel account for a third of the price at the pumps.

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