Destroyed refineries will keep fuel prices high long after war: SARB

The South African Reserve Bank’s Monetary Policy Review has noted that the destruction of oil refineries amid the ongoing geopolitical tensions will keep fuel prices elevated long after peace is restored.

The South African Reserve Bank (SARB) has released the October 2026 Monetary Policy Review (MPR), which gives a more detailed look into the local and international economic developments shaping domestic monetary policy.

The MPR’s release comes as inflation remains above target, and as ongoing conflicts in the Middle East and attacks on energy infrastructure in the Russia-Ukraine war threaten to keep fuel prices high even after geopolitical tensions subside.

Other risks highlighted in this edition include possible food price increases brought on by El Nino, rising inflation expectations, as well as a potential depreciation in the value of the rand due to policy tightening in advanced economies.

The SARB’s priority now is to prevent a temporary inflation increase from becoming entrenched, and to bring inflation back to the 3% target.

To watch the release of the October MPR click here: https://t.co/RznWW71aDE https://t.co/whhpYV89IG Read the MPR here: https://t.co/g8OwDWIUGH #SARBMPROct26 — SA Reserve Bank (@SAReserveBank) October 6, 2026 The comments come as South Africans contend with higher fuel prices, which have seen a litre of petrol climb to R30 on Wednesday.

The bank has noted with serious concern the higher diesel prices and the extent to which fuel prices continue to shape inflation expectations.

Fuel inflation has increased by nearly 25% in the second quarter of 2026.

Global inflation rose in the first half of the year and is expected to remain elevated, reaching 4.4% in 2026.

The outlook is subject to upside risks amid renewed tensions arising from the Middle East conflict. #SARBMPROct26 https://t.co/7UpCiunzMh — SA Reserve Bank (@SAReserveBank) October 6, 2026 Chief Economist at the South African Reserve Bank, Konstantin Makrelov addressed guests at the release of the MPR in Pretoria on Tuesday night.

“The story is not only about oil prices.

It is also about refinery margins, which have increased across regions as refining capacity has been destroyed or taken out of production and the ability to export refined products has been constrained.

It seems that refinery margins are decoupling from oil prices and so even if oil prices moderate, fuel prices are likely to remain elevated,” he added.

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