A conflict in the Middle East is expected to drive up oil prices, leading to higher fuel costs in South Africa from April. Economists predict petrol prices could rise by R5 to R8 per litre, impacting commuters, logistics and food prices. Retailers warn of increased transport and insurance costs amid shipping disruptions.
Oil prices have fluctuated amid the Middle East conflict, reaching $120 a barrel before settling around $100. As of 19 March, prices stood at $108 per barrel, with a recent low of $96 over five days. Frank Blackmore of KPMG South Africa estimates that at $105 oil and a R16.75 rand-dollar rate, fuel prices could rise by R5.30 for April, a 26% increase for inland 95 octane petrol to levels below last year's inflation peak. New prices take effect on 1 April, following a review by the Department of Mineral Resources and Energy. Efficient Group's Dawie Roodt forecasts R5 per litre for petrol and R8 for diesel. For a 47-litre Toyota Corolla Cross tank, a fill-up at current R20.19 per litre costs R950, but could reach R1,325 with an R8 increase, adding R375 per fill or R1,500 monthly for four fills. AA CEO Bobby Ramagwede noted: “You don’t have a choice. You still have to drive to work – you’ll just have to find the money somewhere else.” Taxi fares may rise similarly to 2022 increases of R5 per trip, equating to R200 extra monthly against an average salary of R6,935. Nedbank's Nicky Weimar highlighted a new 21c per litre fuel levy adding to April's petrol hikes, pushing up logistics costs. Woolworths CEO Roy Bagattini said 90% local sourcing limits impact, but diesel rises cost R1 million extra per R1 per litre increase, with port congestion from Cape routing. Shoprite reported 162 stuck containers. Investec's Tertia Jacobs warned of second-round effects on retail and manufacturing from higher diesel, plus 30% fertiliser price rises due to Strait of Hormuz issues—South Africa imports 80% of fertiliser, 30% of farm inputs. Food inflation, at 3.7% in February, faces upside risks despite moderating trends.
