South Africa will temporarily slash its fuel levy to $0.18 per liter for gasoline and diesel in April, Finance Minister Enoch Godongwana announced, as surging oil prices driven by the Iran war threaten to spike domestic fuel costs. Consequently, consumers will only pay about $0.18 more rather than the previously expected $0.36. The move aims to blunt inflationary pressure and protect consumer demand in Africa’s most industrialized economy, with further relief under consideration for the following months. Gasoline prices are projected to jump nearly 30%, while diesel wholesale costs could rise by more than half. Without intervention, this development raises the risk of interest-rate hikes. The decision mirrors steps taken by other oil-importing nations and echoes a similar levy reduction during the Russia-Ukraine war, underscoring how geopolitical shocks continue to reshape fiscal policy across the developing world.
Bloomberg
