Big petrol price hikes announced for South Africa

South African motorists are set to feel the pain, with the Department of Mineral and Petroleum Resources announcing significant increases to petrol and diesel prices in South Africa. 

The increases are largely driven by a surging oil price on the back of US-Israeli military strikes on Iran, which has retaliated by striking multiple countries across the Gulf region. 

This rise has not been offset by a stronger rand, with the local currency coming under pressure as a result of the elevated geopolitical tension. 

As a result, the department announced the following increases, which will come into effect on 4 March 2025 –

• Petrol 93 – increase of 20 cents per litre
• Petrol 95 – increase of 20 cents per litre
• Diesel 0.05% – increase of 62 cents per litre
• Diesel 0.005% – increase of 65 cents per litre

The average Brent Crude oil price increased from $64.08 per barrel to $69.08 per barrel during the period under review. 

Following intense military action in the Middle East, the price of oil has surged towards $80 per barrel over fears of supply disruptions.

Iran is a significant producer of oil, with its output picking up in recent times. Much of its production flows to China, which is the world’s largest importer. 

However, chief investment strategist at Symmetry, Izak Odendaal, noted that the real threat is the conflict disrupting supply from the rest of the region. 

“The threat of closing the Strait of Hormuz, through which a quarter of global seaborne crude is shipped, is significant,” Odendaal said. 

“A prolonged closure could push oil up to $100/barrel, though it is probably harder than it sounds. It is not even in Iran’s interest to weaponise oil prices.”

However, so far, the Organisation for Petroleum Exporting Countries (OPEC), has actually looked to boost production to reduce the impact of a sudden shock in oil prices. 

Odendaal also noted that the world was on track for a record oil surplus in 2026, which gives it some room to absorb a supply shock without prices rising too violently. 

He also pointed out that the global economic growth, and thus demand for oil, is slowing, which will minimise the impact of any disruption in flows from the Persian Gulf. 

“A rise to $100 would be a worst-case scenario, but it is unlikely now. Global oil markets seemed well-supplied with Brent trading near $60 not that long ago. Moreover, markets already priced in the possibility of a US attack,” Odendaal explained.

Closer to home, petrol and diesel prices are set to be pushed higher by increases to various taxes levied on fuel in South Africa. 

Finance Minister Enoch Godongwana announced the following increases in his 2026 Budget Speech –

• The General Fuel Levy will increase by 9 cents per litre for petrol and 8 cents per litre for diesel.
• The Carbon Fuel Levy will increase by 5 cents per litre for petrol and 6 cents for diesel.
• The RAF Levy will increase by 7 cents per litre.

The rand has held its own against the dollar, despite escalating geopolitical tensions, with the currency strengthening slightly against the greenback over the past month.

However, this marginal strengthening was not enough to offset the sharp rise in the global oil price