Oil shock: Brace for R5/l to over R8/l SA fuel spike

It’s a fluid situation – but the oil price spike to over $115 a barrel on Monday morning, is set to be a major shock to world markets, fuel prices and ultimately the pockets of ordinary South Africans.

Speaking to Moneyweb, Stanlib chief economist Kevin Lings now calculates that at a global oil price of $120, SA’s under-recovery in the petrol price would “jump to around R5.40/l and R10/l for diesel”.  This will mean an even sharper increase in April if oil stays at current levels and rand weakness continues.

Read:
Oil soars toward $120 as Iran war forces more production cuts
Over R2trn JSE wipeout

“At $100 a barrel, the petrol price under recovery is around R4.50/l and diesel at about R8.30/l,” says Lings.

The above calculations exclude the inflation-linked increases in fuel levies announced by Finance Minister Enoch Godongwana in the 2026 Budget in February.

“The big question is how long does it [global oil prices] stay there, or does it go higher? SA fuel price increases are determined by the monthly average under recovery,” says Lings.

He warned last week of the current ‘massive’ under-recovery in the petrol and diesel price, in the wake of the Middle East conflict. That was when the Brent crude price spiked to just below $80 a barrel, and the forecast under-recovery was between R2 to R4 a litre.

Read:
Government ‘closely watching’ the oil price and jet fuel situation – Creecy
April fuel prices set to rocket

In an X post on Monday, noted market analyst Keith McLachlan warned: “Oil at >$100 is a systemic shock to the global economy, like a global central banker doubling global interest rates.”

Oil price at >$80 is mixed with some sectors benefiting and some not. Oil at >$100 is a systemic shock to the global economy like a global central banker doubling global interest rates.

ADVERTISEMENT:

CONTINUE READING BELOW

— Keith McLachlan (@keithmclachlan) March 9, 2026

The shock is set to fuel inflation in SA, with several economists including Lings saying interest rates cuts forecast at the start of the year are now off the table, and there could in fact be rate hikes depending on how long the Middle East crisis lasts.

“The length and area of the conflict is key to how much this affects the world,” McLachlan tells Moneyweb.

Listen/read: