The South African Reserve Bank published six staff research notes on 28 October that compare the 2026 oil price shock with the 2022 one. Its economists found that the fuel price rise has so far passed through to consumer prices at about 8% of its size, against 15% in 2022.
The first note, by Keletso Morwane and Rudi Steinbach, covers the six months since US and Israeli strikes on Iran on 28 February 2026. It used 389 eight-digit components of the consumer price index. Brent crude reached US$138 a barrel in the first week of April, after averaging US$67 in January, and averaged about US$102 in September. Petrol rose by R3.06 a litre in April and R3.27 in May, despite temporary fuel levy relief.
How 2026 compares with 2022
Prices in 48% of the items rose faster than the inflation target, against more than 63% after the 2022 shock. Prices rose outright in 75% of items, against 86%. The gap between the 10th and 90th percentiles of price changes was 7.4 percentage points, about six tenths of the 12 points in 2022.
Food explains much of the difference. According to the note, food prices have risen by 1.2% since the shock, below 2022, helped by softer cereal and meat prices. The authors still described the response as broad and intense. Recent price pressures make up 65% of the latest annual inflation rate, against 66% in 2022.
Expectations and wages
A second note, by Anis Foresto, Monique Reid and Cobus Vermeulen, estimates the effect of a 30% fuel price rise on firms’ inflation expectations. A once-off shock lifts two-year-ahead expectations by 0.15 percentage points. A sustained shock lifts them by 0.65 points at the peak, more than four times as much, and the effect fades only after eight quarters.
20222026
Source: South African Reserve Bank, Special Occasional Bulletin of Economic Notes 26/1, October 2026. Items are 389 eight-digit CPI components. The 2022 share above target is given as more than 63%. Chart: Rand Desk
A third note examines wages after a 40% oil price shock. It found that firms, financial analysts and trade unions revise their wage expectations up at once, while realised wage growth responds with a delay of one quarter. The authors link the delay to collective bargaining and multi-year agreements.
The note on supply shocks lists its own warning: “The current shock is large and persistent, presenting material risks that expectations could de-anchor”. It adds that second-round effects, where a price rise feeds into wages and further prices, have been smaller since about 2017.
Each note carries the Bank’s disclaimer that the views are the authors’ and not the Bank’s policy. For the latest inflation reading, see September’s inflation of 4.5%, and for how pump prices are set, how South Africa’s fuel price is set.
The next fuel price adjustment is due on the first Wednesday of November, 4 November, when the general fuel levy cut also begins.
