National Treasury signalled it has little room to mitigate against the impact of a looming fuel-price shock stemming from the war in the Middle East.
The price of crude has jumped more than 40% to over $100 a barrel since the US and Israel attacked Iran on February 28, disrupting shipping and production. It would cost the government tens of millions of rand to offset the knock-on effect on petrol and diesel costs, said Duncan Pieterse, the Treasury’s director-general.
“Unless you have those kind of resources, which currently we do not have available as part of our fiscal buffers, you are either looking at no relief, or you’re looking at a very small amount of relief,” he told a conference hosted by Stanlib Asset Management in Johannesburg on Wednesday.
South Africa temporarily reduced its general fuel levy by R1.50 per litre in 2022 to help offset a jump in prices following Russia’s invasion of Ukraine.
If any relief were to be provided, a similar template would be used and the package would be limited, temporary and funded within the existing fiscal framework, Pieterse said.
Data from the Central Energy Fund data suggests that petrol could rise by as much as R4.74 per litre in April. The fuel levy currently stands at R4.15 per litre, meaning prices may still go up next month even if that tax is put on hold.
The Treasury estimates that it collected about R97 billion from the levy in the 2025-26 financial year.
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