Government slashes fuel levy by R3 per litre before massive hikes

South African motorists and transport operators are getting a bit of breathing space, but it’s not exactly a full tank of relief.

Finance Minister Enoch Godongwana has confirmed a temporary reduction of R3.00 per litre on the fuel levy for both petrol and diesel for April. The move comes as fuel prices are set to spike hard following global oil market disruptions.

Speaking ahead of an official announcement at the South Africa Investment Conference in Johannesburg, Godongwana said the intervention is aimed at cushioning consumers from the sharp rise in international oil prices.

“I will temporarily be lowering the fuel levy for this month of April by R3.00,” he said, adding that discussions are ongoing about possible extensions into the following months.

Still a heavy knock for the industry

Even with the levy cut, truckers and fleet owners are still in for a rough ride.

Latest data from the Central Energy Fund shows petrol prices were on track to jump by nearly R6 per litre, while diesel was staring at increases of more than R10 per litre. With the R3 relief factored in, that brings it down to roughly:

• Petrol: +R3 per litre
• Diesel: +R7 per litre

That’s still a serious hit, especially for long-haul operators running tight margins.

What’s behind the spike?

The surge in fuel prices is being driven by global tensions following the escalation involving Iran. Oil prices have shot up nearly 50% since late February, while the rand has also taken strain against the US dollar.

For a country like South Africa that depends heavily on imported fuel, that combination hits straight at the pump.

Bigger picture

Government is clearly worried about the knock-on effects. Higher fuel prices don’t just affect motorists, they push up transport costs, food prices, and just about everything else moving on wheels.

The South African Reserve Bank is targeting inflation at around 3%, and this kind of pressure can quickly throw those projections off.

The fuel levy itself is a major revenue stream, bringing in close to R97 billion annually. So cutting it, even temporarily, shows how serious the situation is.

Not the first time

This isn’t new territory. Back in 2022, government also stepped in with a temporary levy cut when fuel prices surged after the Russia-Ukraine conflict.

SA Trucker, the relief is there, but it’s not enough to fully soften the blow. Diesel still jumping by around R9 per litre means transport costs are going up, no two ways about it.

Expect pressure on rates, tighter margins, and more tough conversations between operators and clients in the weeks ahead.