Many of those waiting in long queues to fill up with fuel on Tuesday night were no doubt cursing Donald Trump, who is single-handedly responsible for the latest global fuel crisis after starting a war he had no legitimate reason to.
Perhaps it’s the latest move in his quest for world domination: like Gru and his minions, he has been plotting ways to steal the moon, taking out anyone who gets in his way.
Whatever his reason, it is yet another blow for South Africans in particular, who have long been on the receiving end of Trumponomics and will continue to be until the madness comes to an end, as it must inevitably do, sooner or later.
Today, South Africa is paying R3.08 more for a litre of petrol, R7.37 more for diesel and a catastrophic R11.67 more for paraffin — effectively doubling the cost of this product which is a staple in our poorest households. Were it not for government intervention, reducing the fuel levy by R3 a litre, the blow would have been even more severe.
Thank you, Trump, for one of the most severe fuel shocks in history, which comes just as South Africa seemed to be emerging from the worst of its economic slump.
Until sanity returns, South Africa’s economy will be in relapse. As we know by now, the fuel hikes will cause the cost of living to increase, which will cause inflation to rise, ultimately bringing an end to our recent trend of gentle interest rate cuts — and perhaps even reversing them.
Industries involved in transport — including public, air, freight, couriers — will be hardest hit, along with other fuel-intensive sectors such as mining, manufacturing and agriculture.
Belt-tightening has once again become imperative and households must apply self-discipline to prevent sinking back into crippling debt.
South Africa is among the countries most impacted by the global fuel shortage as it imports more than 90% of its petroleum products. While we produce synthetic fuel from coal, our refining capacity is limited, requiring heavy imports of refined fuel, particularly diesel.
Other countries critically affected by the shortage include Singapore, Philippines, Sri Lanka, Egypt, Myanmar, Pakistan, Somalia, Hong Kong and Thailand.
So today is the day for us to strap in and brace for tough times ahead. Once again, South Africa’s poorest communities will be hardest hit due to food and public transport increases.
Add in looming electricity price hikes — Eskom’s 8.76% increase kicked in on April 1 — and the prospect of a possible recession in the not too distant future does not seem unrealistic, especially if Trump digs his heels in.
While debt-to-income ratios have recently improved slightly, those gains could also be reversed, plunging South Africa back into a spiral of debt despair.
Belt-tightening has once again become imperative and households must apply self-discipline to prevent sinking back into crippling debt.
Government has already stepped in to mitigate fuel price increases, but much more will be required from our administrators in the months to come. It is an economic path all South Africans need to navigate carefully and strategically, lest we undo the gains we have made over the past year.
Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.
Please read our Comment Policy before commenting.