South Africa opened 2026 with a broad-based fuel price reduction, providing relief to households, businesses, and transport operators amid persistent volatility in global oil markets. The adjustment, announced by the Minister of Mineral and Petroleum Resources, took effect on 7 January and marked one of the most significant month-on-month diesel price cuts in recent years.
According to the Department of Mineral and Petroleum Resources, the average Brent crude oil price declined from USD 63.55 to USD 61.47 during the review period, reflecting oversupply linked to increased production by OPEC+ and non-OPEC producers. The easing in crude prices fed through to international petroleum product markets, where petrol, diesel, and illuminating paraffin fell sharply due to ample winter inventories in the Northern Hemisphere.
The adjustment lowered the Basic Fuel Price by 45.03 cents per litre for petrol, 126.97 cents for diesel, and 87.96 cents for illuminating paraffin. Currency movements reinforced these reductions, as the rand appreciated from R17.22 to R16.85 per US dollar, cutting fuel import costs by over 20 cents per litre across major products.
At the pump, Petrol 93 dropped by 62 cents per litre, while Petrol 95 declined by 66 cents. Diesel saw the steepest reductions, falling by R1.37 per litre for 0.05% Sulphur diesel and R1.50 per litre for 0.005% Sulphur diesel. Illuminating paraffin prices were cut by R1.10 per litre at wholesale. Conversely, the maximum retail price of LPG increased modestly due to tighter global supplies of propane and butane.
The government confirmed that the Slate Levy remains at zero cents per litre, supported by a positive cumulative slate balance of R3.3 billion as of November 2025, indicating that recent price movements have not destabilised the fuel pricing mechanism.
Fuel price volatility in South Africa has historically been shaped by external factors, with petrol prices climbing from under R2 per litre in the mid-1990s to above R21 per litre in 2025. Monthly adjustments increasingly reflect global supply shocks, geopolitical tensions, and exchange rate swings rather than domestic policy.
While the January 2026 cuts provide short-term relief, the economy remains exposed to external shocks due to heavy reliance on imported crude and refined products amid declining domestic refining capacity. Analysts expect fuel prices to remain volatile, even as consumers benefit from the early-year reductions.
