Amid the ongoing conflict in the Middle East and its impact on global oil prices and domestic fuel prices, National Treasury and the Department of Mineral and Petroleum Resources (DMPR) has announced further price relief measures for May and June.

For April, Treasury and the DMPR halved the fuel levy by R3 a litre and have now decided to extend that reduction to June 2. The general fuel levy for petrol will remain at R1.10 a litre until June 2.

Further, Finance Minister Enoch Godongwana has decided that the temporary relief for diesel be increased by 93c to R3.93 a litre, reducing the levy to zero, from May 6 to June 2.

For the month of June, the Minister proposes that the level of relief is halved to phase out the relief before July. As a result, the amount of relief from the general fuel levy will be reduced to R1.50 a litre for petrol and R1.96 a litre for diesel, effective from June 3 to June 30.

This will increase the general fuel levy for petrol from R1.10 a litre to R2.60 a litre and increase the general fuel levy for diesel from R0 a litre to R1.97 a litre for June.

From July 1, the general fuel levy for petrol will return to R4.10 a litre and the general fuel levy for diesel to R3.93 a litre.

Treasury and the DMPR point out that the estimated cost of the temporary fuel levy relief from April to June 2026 is R17.2-billion in foregone tax revenue.

North West University Business School economist Professor Raymond Parsons has welcomed government's decision to extend the fuel price relief.

"The magnitude of the global energy price shock to the economy makes an extension of the partial petrol and diesel relief to further mitigate the impact of negative global developments inevitable and desirable.

"It is not only necessary on social grounds, but also because identifiable fiscal space exists for a flexible financial response through higher-than-expected tax revenues, combined with promised spending reviews. This is in line with what most countries have found essential to do in an effort to mitigate the impact of soaring fuel costs on their economies," he says.

He adds that the estimated total cost of the relief to the Treasury of R17.2-billion by June is affordable up to a point.

"As the government announcement confirms, the dashboard of the 2026 Budget need not change. As a rough estimate, the supportive measures could shave about 0.2% off headline inflation in coming months. But fuel costs will still rise significantly depending on how long the global oil price remains highly elevated.

"Market confidence will be retained as long as extended assistance is predicated on the assurance that South Africa’s public finances will basically remain fiscally ‘neutral’, even as fiscal priorities are revisited. Available fiscal space nonetheless needs to be critically interrogated.

"In these acute and uncertain global circumstances, the trade-offs needed to strike the right balance inevitably call for difficult, but unavoidable, policy decisions," Parsons states.