Energy

From bad to worse for petrol and diesel prices in South Africa

Staff Writer

 ·21 Jul 2026

Diesel price recoveries in South Africa have fully swung into the red, with the negatives deepening as the war between the United States and Iran continues.

According to data from the Central Energy Fund for the new week, diesel price recoveries have swung to an under-recovery for both Diesel 0.05% and Diesel 0.005%.

This comes from a downward trend last week, where Diesel 0.005% recoveries hit a neutral level.

Diesel recoveries are being hit from both ends, with the war in the Middle East shutting down the Strait of Hormuz yet again—sending oil prices soaring—and shortages out of Russia.

Chief investment strategist at Symmetry, Izak Odendaal, warned last week that despite mid-month over-recoveries in diesel prices, the fuel would push into negative territory because of the war.

The over-recovery of around 30 cents per litre would be overwhelmed by the daily under-recovery of around R3.73 per litre tied to the conflict, he said.

Similar warnings were echoed by Frank Blackmore, Lead Economist at KPMG South Africa, who noted that a break in the ceasefire in the Strait of Hormuz would lead to further price increases.

“It can be that over recovery is absorbed between now and the end of the month when prices are set,” he said.

This has now come to be.

The CEF’s data for the start of the week shows that diesel is now sitting at an under-recovery of between 22 and 45 cents per litre—pointing to more price hikes on the way.

As a consolation, petrol recoveries are still in the positive, with an over-recovery between 79 and 83 cents per litre, but even this is slipping, with the positives gradually receding.

These are the recoveries at the end of the week:

• Petrol 93: decrease of 83 cents per litre
• Petrol 95: decrease of 79 cents per litre
• Diesel 0.05% (wholesale): increase of 45 cents per litre
• Diesel 0.005% (wholesale): increase of 22 cents per litre
• Illuminating paraffin: increase of 21 cents per litre

This is how recoveries have shifted this month-to-date (MTD):

A smaller cut in petrol and a possible 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.

This, in turn, will add pressure on inflation in the country as industry, businesses, and consumers all bear the higher costs of fuel and other increases along the supply chain.

It will also play into the South African Reserve Bank’s assessment of markets and the economy when determining its interest rate moves.

The SARB’s Monetary Policy Committee is meeting this week and will announce its next policy move on Thursday (23 July).

According to KPMG’s Frank Blackmore, the assumption would have been to keep rates steady, given the fact that under the previous ceasefire conditions, oil prices were falling.

However, with the reignition of the war, and higher oil prices following, the SARB “will have to look at if the impact over a prolonged period of time requires an additional increase in the policy rate”.

Economists were generally split between the SARB holding rates and hiking by another 25 basis points. As the war continues, the position has increasingly shifted to anticipating the hike.

Post-Iran War price adjustments