We’ve Limited Capacity to Shield Fuel‑price Shock from Israel-Iran War, Says South Africa

South Africa’s National Treasury has said it has limited capacity to shield consumers from increases in energy price hikes arising from the situation in the Middle East over the United States -Israel and Iran conflicts.

Treasury Director-General Duncan Pieterse told a Stanlib Asset Management conference in Johannesburg that cushioning the impact on petrol and diesel would cost the government tens of millions of rand, Bloomberg reported.

“Without those resources in our fiscal buffers, any relief would be minimal or non-existent,” he said.

South Africa briefly cut its general fuel levy by 1.50 rand per litre in 2022 after Russia invaded Ukraine.

Any similar intervention now would be small, temporary, and funded within the current budget. The Treasury collected about 97 billion rand from fuel levies in 2025–26.

The ongoing oil price disruption comes as Africa’s most industrialised economy is still recovering, with growth of 1.1% last year—its highest rate since 2022. Electricity shortages and logistical bottlenecks, which reduced mining and manufacturing output and discouraged investment, contributed to South Africa underperforming economically for a decade, growing on average less than 1% per year.

Beyond South Africa, other African countries not directly involved in the conflict are also feeling the pressure. Ethiopia is urging citizens to cut back on fuel consumption amid supply disruptions from the Middle East.

Nigeria, largely self-sufficient thanks to the Dangote Refinery, has raised fuel prices three times recently, adding strain to households.

Analysts warn that securing fuel may become increasingly difficult for developing nations as wealthier buyers outbid them on global markets.