South Africa Extends Fuel Levy Relief to Curb Price Hikes

The South African government has extended temporary fuel levy relief until June 2026 to mitigate sharp price increases driven by oil supply volatility and conflict in the Middle East. Enoch Godongwana, the Minister of Finance, announced that the R3 per litre reduction for petrol will remain in place through May. For diesel users, relief will increase by 93 cents to R3.93 per litre effective May 6, effectively reducing the general diesel levy to zero for the month.

To avoid a sudden price shock, the government will halve the relief measures starting June 3 before phasing them out entirely in July, when full levies return. These interventions follow projections from the Central Energy Fund that diesel prices would rise by over R5 per litre and 95-octane petrol by more than R2 per litre in May.

The National Treasury estimates the total cost of the relief from April to June 2026 at R17.2 billion in foregone tax revenue. This will be funded through higher-than-expected tax collections and departmental underspending to maintain the 2026 Budget fiscal framework.

While the Motor Industry Staff Association welcomed the move as a positive step for transport workers and businesses, the organization criticized the exclusion of illuminating paraffin users. The association is calling for a transparent review of the local fuel pricing mechanism, which the Department of Mineral and Petroleum Resources expects to complete by March 2027.