South Africa’s diesel price outlook is increasingly dire, with the latest data from the Central Energy Fund indicating a substantial price increase of R7.39 for 500ppm and R7.50 for 50ppm. Although petrol is experiencing a less severe under-recovery, motorists are still poised to face significant hikes of approximately R4.10 for 93 Unleaded and R4.53 for 95 Unleaded.
A diesel price increase of more than R8 per litre and a petrol hike in excess of R5 is certainly plausible if current oil prices and rand weakness persist until the end of March. The diesel price hikes in particular will have a devastating effect on South African inflation due to elevated transport costs. According to the Department of Mineral Resources and Energy, the prices of petroleum products are determined by the international prices of crude oil and the exchange rate between the Rand and the US Dollar.
Diesel Price Hikes to Affect Economy
The final blow will be dealt by the increase in fuel taxes that was announced by Finance Minister Enoch Godongwana during his 2026 Budget Speech. From April 1, South Africans will be paying an additional 21 cents per litre in fuel taxes, following increases to the General Fuel Levy (9 cents), Carbon Levy (5 cents) and Road Accident Fund levy (7 cents). Following the tax adjustments, drivers will be contributing a total of R4.10 per litre to the GFL and R2.25 to the embattled RAF.
Impact on Consumers
95 Unleaded petrol currently costs R19.47 at the coast and R20.30 in Gauteng, where 93 Unleaded retails at R20.19. The wholesale price of diesel is currently pegged at R17.84 at the coast and R19.17 inland. Here are some key factors to consider:
- The diesel price increase will affect the cost of transportation, which will have a ripple effect on the prices of goods and services.
- The fuel tax increase will add to the already high cost of living for South Africans.
- The rand’s weakness against the US Dollar will continue to impact the prices of petroleum products.
As the South African Reserve Bank continues to monitor the economy, it is essential for consumers to be aware of the potential impact of the diesel price hikes on their pockets. With the current economic climate, it is crucial for South Africans to be prepared for the potential consequences of the price increase.
