R2 per litre petrol price pain for South Africa
Global oil prices have once again hit $100 a barrel, sinking petrol price recoveries by R2 per litre this month, and pushing diesel recoveries deeper into the red.
Data from the Central Energy Fund for the end of the fourth week in July shows that the strong over-recoveries for petrol prices at the start of the month have all but disappeared.
After starting the month with an over-recovery of R2.50 per litre—laying the foundation for a sizeable cut in prices for August—this has now been reduced to around 40 cents per litre.
While this still puts motorists in line for a cut at the pumps, it is nowhere near enough to reverse the R6-per-litre price gap from before the Iran war broke out.
The story for diesel is more bleak.
After beginning the month with an over-recovery of R3 per litre, price movements have completely flipped into an under-recovery, with the fuel now on track to be hiked by as much as R1.10 per litre.
These are the recoveries at the end of the week:
- Petrol 93: decrease of 46 cents per litre
- Petrol 95: decrease of 41 cents per litre
- Diesel 0.05% (wholesale): increase of R1.10 per litre
- Diesel 0.005% (wholesale): increase of 89 cents per litre
- Illuminating paraffin: increase of 84 cents per litre
Month to date, recoveries have shrunk by R2 per litre for petrol and by more than R4 per litre for diesel.
This is how recoveries have shifted this month-to-date (MTD):
| Fuel | July starting over(under) recovery | Current over(under) recovery | MTD Change |
|---|---|---|---|
| Petrol 93 | R2.50 | R0.46 | (R2.04) |
| Petrol 95 | R2.50 | R0.41 | (R2.09) |
| Diesel 0.05% | R3.07 | (R1.10) | (R4.17) |
| Diesel 0.005% | R3.51 | (R0.89) | (R4.40) |
| Illuminating Paraffin | R3.43 | (R0.84) | (R4.27) |
The smaller cut in petrol and a likely hike in diesel will also slow or stem the recovery in prices toward pre-war levels.
As things stand, petrol prices are still R6 per litre higher than when the war began, with diesel prices more than R7 per litre higher.
At current recovery levels, the projected August changes would hardly make a dent in petrol, and would widen the gap for diesel to over R8 per litre.
Post-Iran War price adjustments
| Month | Petrol 95 | Diesel 0.005% |
|---|---|---|
| March | +R0.20 | +R0.65 |
| April | +R3.06 | +R7.51 |
| May | +R3.27 | +R5.27 |
| June | +R1.43 | -R2.62 |
| July | -R1.96 | -R3.59 |
| Total difference | +R6.00 | +R7.22 |
| August (current recovery) | -R0.41 | +R0.89 |
| Projected difference | +R5.59 | +R8.11 |
War rages on
The ill turn in fortunes can be attributed to the United States’ ongoing war against Iran.
Global oil markets were thrust into chaos and uncertainty when the United States launched attacks on Iran at the end of February 2026.
The sudden and unexpected onset of war in the Middle East caused global oil prices to rocket to $120 a barrel.
The war shut down the Strait of Hormuz, a critical channel through which about 20% of the world’s oil is transported.
The oil price shock hit energy prices hard, with fuel prices rising through to June.
When the US and Iran signed a memorandum of understanding to open the Strait and negotiate a long-term peace agreement, markets turned, resulting in some relief in July.
However, the ceasefire collapsed soon after, with the United States having restarted its attacks and the Strait once again shutting down.
Markets had, until now, been hopeful that the US and Iran would work towards peace, with many analysts optimistically pencilling in prices being contained around $80 a barrel.
$100 a barrel was seen as “unlikely”. However, prices hit that level after Houthi attacks on tankers in the Red Sea opened a new front in the Middle East conflict.
Meanwhile, US President Donald Trump threatened to extend US strikes on Iran as negotiations between the two nations faltered and an end to the conflict remained elusive.
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