# Impact on South Africa as oil hits 5-month high

An episode of [Afternoon Drive with John Maytham](https://invisiblenetwork.ai/podcast/1212305258), 26 Oct 2026, 6:50.

Audio: https://p.podderapp.com/1951050295/traffic.omny.fm/d/clips/5dcefa8e-00a9-4595-8ce1-a4ab0080f142/e2113905-04ff-472c-9fff-a6cd00b63b20/5485a9e4-36ab-419f-b3dd-b4ef00e927b5/audio.mp3?utm_source=Podcast&in_playlist=cab9ce5d-42b6-4239-9177-a6cd00b6d1ff

Bureau for Economic Research senior economist, Shannon Bold, speaks to John Maytham about the impact on South Africa after crude oil on Thursday jumped to a five-month high. Presenter John Maytham is an actor and author-turned-talk radio veteran and seasoned journalist. His show serves a round-up of local and international news coupled with the latest in business, sport, traffic and weather. The host’s eclectic interests mean the program often surprises the audience with intriguing book reviews and inspiring interviews profiling artists. A daily highlight is Rapid Fire, just after 5:30pm. CapeTalk fans call in, to stump the presenter with their general knowledge questions. Another firm favourite is the humorous Thursday crossing with award-winning journalist Rebecca Davis, called “Plan B”. Thank you for listening to a podcast from Afternoon Drive with John Maytham Listen live on Primedia+ weekdays from 15:00 and 18:00 (SA Time) to Afternoon Drive with John Maytham broadcast on CapeTalk https://buff.ly/NnFM3Nk For more from the show go to https://buff.ly/BSFy4Cn or find all the catch-up podcasts here https://buff.ly/n8nWt4x Subscribe to the CapeTalk Daily and Weekly Newsletters https://buff.ly/sbvVZD5 Follow us on social media: CapeTalk on Facebook: https://www.facebook.com/CapeTalk CapeTalk on TikTok: https://www.tiktok.com/@capetalk CapeTalk on Instagram: https://www.instagram.com/ CapeTalk on X: https://x.com/CapeTalk CapeTalk on YouTube: https://www.youtube.com/@CapeTalk567 See omnystudio.com/listener for privacy information.

## Transcript

[0:00] Speaker 1: Oil is at around about $ 115, $ 116 a barrel, and
[0:01] Speaker 1: it's been there for quite a few days now. And yes,
[0:03] Speaker 1: the latest statistics from the Central Energy Fund is that
[0:06] Speaker 1: the fuel costs relief on diesel will mean that diesel
[0:25] Speaker 1: users might have a small drop in the price of
[0:27] Speaker 1: diesel at the end of the month, but the fuel
[0:30] Speaker 1: levy relief on petrol won't be enough to cushion the
[0:34] Speaker 1: blow and that there will be an increase. And if
[0:38] Speaker 1: oil prices continue at these levels, then come January when
[0:42] Speaker 1: the fuel price relief finishes, we're in serious trouble. Shannon
[0:47] Speaker 1: Bold is a senior economist at the macroeconomic modeling and
[0:54] Speaker 1: forecasting unit of the Bureau for Economic Research. Hello, Shannon.
[0:58] Speaker 2: Hi, John. How are you?
[1:00] Speaker 1: I am worried about the oil price. How are you?
[1:02] Speaker 2: Same.
[1:05] Speaker 1: I mean, what has changed? Because conditions in the Strait
[1:08] Speaker 1: of Hormuz haven't changed that much. The Houthis have been
[1:13] Speaker 1: involved with Saudi Arabia for a while now, and that
[1:17] Speaker 1: still had the oil price at around high 90s, low 100s.
[1:21] Speaker 1: So what's happened over the last five, six days to
[1:24] Speaker 1: add 10% to the price of crude oil?
[1:28] Speaker 2: Look, I think the longer the war drags on, the
[1:31] Speaker 2: more pressure it's going to start putting on the oil price.
[1:35] Speaker 2: And I think the worry is also just, you know,
[1:37] Speaker 2: the refinery supply around the globe. It's really wearing thin now.
[1:43] Speaker 2: We had buffers when we were in the earlier days
[1:45] Speaker 2: of the war, but the longer it drags on, the
[1:47] Speaker 2: more it's just going to start you know, permeating through
[1:51] Speaker 2: the markets.
[1:53] Speaker 1: Israeli elections tomorrow, midterm elections in the US on Tuesday
[1:57] Speaker 1: next week to worry around what those elections might produce,
[2:02] Speaker 1: contribute in some way?
[2:06] Speaker 2: I don't think those are going to solve the problems
[2:10] Speaker 2: that's going on in the oil market.
[2:12] Speaker 1: But I mean, are some people looking at it and
[2:16] Speaker 1: saying things could get worse? as a result of election
[2:20] Speaker 1: results not going and sort of last act of defiance
[2:23] Speaker 1: from outgoing Netanyahu, Trump asserting his primacy over foreign policy
[2:27] Speaker 1: despite a knockdown in the midterms, that kind of thing
[2:31] Speaker 1: increasing tension in the market.
[2:34] Speaker 2: Yes, for sure, for sure.
[2:36] Speaker 1: Okay, and it's really hard to see, as I've said
[2:43] Speaker 1: so many times since February, where the off-ramp is. And
[2:46] Speaker 1: with the Houthis getting involved and so in the Saudi pipeline,
[2:51] Speaker 1: which has kept some oil flowing, that's under threat as well. Yeah,
[2:57] Speaker 1: it's really hard to see where the downward pressure is
[3:00] Speaker 1: going to come from.
[3:02] Speaker 2: Exactly. But I do think that eventually it's just going
[3:07] Speaker 2: to be part of the baseline, right? I think every time,
[3:11] Speaker 2: every year, as an economist, there's always a new shock
[3:14] Speaker 2: to talk about, right? We didn't know, or many people
[3:18] Speaker 2: didn't even know where the Strait of Hormuz was this
[3:20] Speaker 2: time last year. Last year, the sexy thing was all
[3:23] Speaker 2: about trade tariffs. And the year before that, it was Russia-Ukraine.
[3:26] Speaker 2: And those things are still going on in the background.
[3:29] Speaker 2: It's just part of the baseline now.
[3:31] Speaker 1: Yeah, but I'm just, sorry, I'm just, what was the
[3:34] Speaker 1: oil price on, what's the date today? October 26, October 26, 2025.
[3:45] Speaker 1: So the oil price a year ago today was $ 65
[3:49] Speaker 1: a barrel. Exactly. But those things that you said were
[3:54] Speaker 1: the baseline were there, and the oil price was still $ 65.
[3:57] Speaker 1: So the thing which has the oil price at $ 116
[3:59] Speaker 1: is the war in Iran.
[4:03] Speaker 2: Yes. But the year before that, the oil price was
[4:07] Speaker 2: higher because of Russia and Ukraine as well. Okay.
[4:09] Speaker 1: What was the oil price on October 26, 2024? Uh,
[4:16] Speaker 1: that was $ 67. So, you know, I mean, this is very,
[4:19] Speaker 1: very unusual. I mean, of course we've had big oil
[4:22] Speaker 1: shocks before, um, but those didn't last as long as
[4:25] Speaker 1: this one is. We don't know what's going to happen.
[4:28] Speaker 1: I don't know what the BRS prediction is for, uh,
[4:31] Speaker 1: for the crude oil price in six months time. But if,
[4:35] Speaker 1: if the oil price does continue to hover around 110, 116, $ 120.
[4:42] Speaker 1: The Treasury can only give us fuel levy relief. Well,
[4:47] Speaker 1: they can't keep doing it, or can they? What's the
[4:50] Speaker 1: impact on our economy?
[4:53] Speaker 2: Yes. So, I mean, the Treasury has said in the
[4:56] Speaker 2: NTPPS this week that they can only afford the $ 10
[4:59] Speaker 2: billion because that's a fiscally neutral transfer between the CEF
[5:03] Speaker 2: and the National Revenue Fund. So that's working out to
[5:07] Speaker 2: the three rand on diesel and 150 on petrol this month,
[5:10] Speaker 2: or November, sorry, and then December effectively half on diesel,
[5:14] Speaker 2: so 150 on diesel and one rand on fuel. But
[5:18] Speaker 2: I must say, it sounded in a lot of the
[5:22] Speaker 2: sidelines chatting that they said as long as it's fiscally neutral,
[5:27] Speaker 2: they would always be prepared to offer support because of
[5:31] Speaker 2: the impact it is having on the economy. And just
[5:33] Speaker 2: to your earlier question, I mean, we're expecting the average
[5:37] Speaker 2: oil price this quarter around 103.6 cents. And already there's
[5:42] Speaker 2: a lot of pressure around that forecast. And we see
[5:45] Speaker 2: it staying above 90 into the second half of next year.
[5:49] Speaker 2: So the impact that it has on inflation is not
[5:52] Speaker 2: just from the oil price. It's also from that refinery
[5:57] Speaker 2: pressure that's coming through. So there's extra costs that come
[6:00] Speaker 2: through that you feel at the pump. And because of
[6:05] Speaker 2: the pressure that is on those margins, it's even more
[6:08] Speaker 2: than just the oil price. So it really is massive.
[6:11] Speaker 2: And I think this is exactly why the bank was
[6:13] Speaker 2: right in pushing up the latest repo rates in September
[6:19] Speaker 2: and why November is a risk for another hike. But
[6:22] Speaker 2: at the same time, it's really difficult to see that
[6:25] Speaker 2: happening because the fuel price in and of itself already
[6:29] Speaker 2: weighs on household consumption. And that's the way that monetary
[6:32] Speaker 2: policy kind of goes through the channel is through dampening demand.
[6:38] Speaker 2: So it would be, you know, a double whammy if
[6:41] Speaker 2: another hike were to come through. And then, yeah.
[6:46] Speaker 1: Shannon Bold of the Bureau for Economic Research.
[6:49] Speaker 2: Thank you.

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