The Department of Mineral and Petroleum Resources is reviewing South Africa’s fuel price formula in an effort to reduce costs for motorists.
This is according to the department’s Director of Fuel Pricing Mechanism, Robert Maake, who spoke to SAnews.gov.za in Pretoria on Tuesday (7 April 2026).
He explained that the fuel price is influenced by several factors, including global forces like the international oil price, shipping costs, the fluctuating US dollar/rand exchange rate.
It is also influenced at the domestic level by things like storage costs, and various government taxes and levies.
“Our pricing formula is based on two components. One of them is the import part, where all the costs associated with importing petroleum products into South Africa are accounted for,” he said.
“The second part is the local factor. What changes on a monthly basis is the international component driven mainly by the oil price and the Rand/Dollar exchange rate.”
“What is happening now is the very high oil price due to the war in the Middle East, which is driving the [escalating] fuel prices and the weaker Rand.”
While the government has no control over the international factors like oil prices, it is re-evaluating how it influences fuel prices locally.
“The main one for us in the department is the review of the fuel price mechanism. What we are going to do now is review how industry margins are calculated in South Africa,” said Maake.
The department is reviewing the wholesale margins, retail margins, secondary storage, and secondary distribution.
Unfortunately, this process will take some time, as the results are only expected next year.
“That process has started. We have already signed a service level agreement with a service provider and we expect that work to be concluded by March 2027.”
While motorists won’t see any benefit from the fuel price review for some time, the government has already taken action by temporarily slashing the General Fuel Levy (GFL).
The GFL normally adds over R4 to the cost of petrol and diesel, but it has been reduced by R3 to offset April’s enormous fuel price increases.
“In the short term, it means that consumers are actually paying R3 less for petrol and diesel at the service stations, which is useful for households and motorists.
“It is difficult at the moment to say how the government will intervene [in the long term] and what the next step will be,” Maake said.
No fuel shortages in South Africa
Maake also addressed the reports of fuel shortages that surfaced in late March.
“What we have seen…is something that we have never seen before. Particularly the magnitude of the fuel price increase,” he said.
“So what likely happened is that some of the commercial customers were trying to buy in bulk in anticipation of the high fuel prices. So, they were placing additional orders on top of the orders they had with the suppliers.
“But also, there were complaints that some service stations were running out of fuel, and people were thinking that they were hoarding fuel until the new price kicks in. That was a big challenge for us.
“However, we just came from the long weekend and from the reports that we are getting, there were not a lot of reports from provinces that they were running out of fuel.”
Maake stressed that South Africa’s fuel supply is stable and that the department has met with oil companies to discuss the matter.
He said that several oil companies have indicated that a number of vessels have been secured and will be coming to South Africa through to the end of May.
Furthermore, additional orders will be placed to ensure fuel supplies continue past this point.
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