SOUTH AFRICA — Consumers and businesses across the country can expect immediate financial breathing room following the announcement of comprehensive fuel levy relief by Finance Minister Enoch Godongwana. Delivering the Medium Term Budget Policy Statement (MTBPS) in Parliament on Wednesday, the Minister outlined a strategic, phased reduction in the general fuel levy aimed at cushioning the economy from record-high energy costs.
The intervention arrives at a critical juncture for the economy. Escalating petrol and diesel prices have placed severe strain on household budgets and commercial operations, with pump prices reaching historic peaks. These surges are primarily driven by skyrocketing Brent Crude Oil prices, which have been heavily exacerbated by ongoing geopolitical conflicts in the Middle East.
Detailing the structure of the fuel levy relief, Godongwana explained that the government will implement a two-tiered approach to support motorists and industries. The initial phase, effective from 4 November 2026 through 1 December 2026, will see the levy on diesel slashed by R3 per litre, while petrol will benefit from a R1.50 per litre reduction.
Following this initial window, a secondary tier of relief will take effect and run until 5 January 2027. During this period, the diesel levy will be reduced by R1.50 per litre, and the petrol levy will be lowered by R1 per litre.
The Minister emphasized that this intervention is specifically designed to ease cost of living pressures without compromising the long-term sustainability of the national budget. To achieve this, the R10 billion fiscal cost of the foregone revenue will be fully accommodated through existing financial buffers.
Godongwana clarified that the funding will be sourced from revenue overruns generated during the 2025/26 fiscal year. Originally, these funds were placed in an appropriation bill to be allocated to the Central Energy Fund (CEF). However, the R10 billion will now be surrendered back to the National Revenue Fund specifically to finance the fuel levy relief package.
This targeted financial support is expected to provide R10 billion in direct relief to households and businesses struggling with transport and operational costs. The reprieve comes as a highly anticipated measure for a public already grappling with steep pump prices; currently, the cost of 95 Petrol sits at approximately R30.25 per litre inland and R29.38 at the coast.
