“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,” the SARB’s chief economist Konstantin Makrelov said at the release of the MPR in Pretoria, reports SABC News.
“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.
Makrelov made the remarks after the Department of Mineral and Petroleum Resources announced the fuel price adjustment for October, which saw petrol reach a record price in SA.
Meanwhile, diesel prices also remained high.
The Reserve Bank said it has noted with serious concern the higher diesel prices and the extent to which fuel prices continue to shape inflation expectations. Fuel inflation rose nearly 25% in the second quarter of 2026.
Reuters reports that accessible oil storage is running low, industry executives said at a forum in London, making the market more fragile and putting upward pressure on prices.
Governments and energy companies have drawn oil from stockpiles to alleviate pressure in a global oil market facing unprecedented supply disruptions this year due to the wars in the Middle East and Ukraine.
“Less than six billion barrels of commercial inventories remain today, with the vast majority not practically available, so the system is already straining,” Amin Nasser, CEO of Saudi Arabia’s state oil company Saudi Aramco, said at the Energy Intelligence Forum in London.
More than one billion barrels of oil have been released mainly from onshore commercial inventories since the start of this year’s Middle East crisis, which Nasser said was the last major tool in the box.
The International Energy Agency, the West’s oil watchdog and coordinator of its strategic oil reserves, is preparing to release 100 million barrels of crude and diesel to help alleviate soaring diesel prices. Still, it is unclear whether that total includes volumes from its record first 400 million barrel release in March that hadn’t hit the market yet.
“It took a lot of negotiations, but it is 100 million,” Nasser said of the IEA decision. “Inventories are reaching a stress level. Only 10% or less is available; that’s why they struggle with 100 million barrels.”
World oil demand is about 102 million barrels per day, according to the IEA.
Meanwhile, oil prices were stable as investors weighed supply risks from the Middle East conflict, Reuters reported.
Brent crude futures rose, while US West Texas Intermediate (WTI) crude also gained.
The market is likely to remain nervous about potential supply disruptions, ING commodity strategists said, adding that Middle East supply risks remain very real amid continued attacks on ships.
Supply has been recovering, however. Saudi Arabia’s East-West pipeline has increased flows, the kingdom’s energy minister, Prince Abdulaziz bin Salman, said.
About 12 million bpd of crude oil and refined products have left West Asia on tankers in the past seven to 10 days, the head of Vitol said.
Investor sentiment lacks conviction that recent rises in West Asian supply and exports are sustainable, PVM analyst Tamas Varga said.
Saudi Arabia’s airports in Jazan and Najran were hit in two attacks, the Saudi aviation authority said, as hostilities between the kingdom and Yemen’s Iran-backed Houthis escalated.
US-Iran relations are no closer to repair, with US President Donald Trump saying that nobody knew who was running Iran during the eight-month US-Israeli war with Iran.
