Competition Commission warns against price gouging as fuel price shock looms

The Competition Commission warns that while significant fuel price increases are on the cards this week, it will not allow retailers to engage in price gouging.

James Hodge, Chief Economist at the Commission, explained that price increases are expected to be significant, with oil prices almost doubling to over $110 a barrel.

This will have a ripple effect on the prices of several products, including fertilisers, plastics, and food items that rely heavily on oil. 

But the key issue is distinguishing between a legitimate price increase and price gouging.

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Hodge emphasised that businesses should not raise prices before their costs rise. And when costs do arise, they should only increase prices by the same amount.

"For the consumer, it's very difficult because you're going to expect a price increase because oil has gone up, but you don't know what's a reasonable amount by which the price should increase and when it should happen,” he said.

The Competition Commission is urging consumers to be vigilant and report any suspicious price hikes.

"Compare prices, consider what things cost now and just over the next few weeks. Continue monitoring whether or not they jump the gun early, and by how much those increases might be.

"If you feel that this increase has been far too quick or far too rapid, you can report to us.”

To listen to Hodge in conversation with 702’s Bongani Bingwa, use the audio player below: