Ramaphosa orders plan to cushion citizens from looming fuel hike

President Cyril Ramaphosa has directed finance minister Enoch Godongwana to find ways to cushion South Africans from a looming fuel hike set to take effect on Wednesday.

Addressing delegates at the ANC Limpopo conference, Ramaphosa said the anticipated increase is giving him sleepless nights as global energy prices surge amid conflict in the Middle East.

The April 1 fuel price hike is being driven largely by the war involving the US, Israel and Iran. Iran’s closure of the Strait of Hormuz — a key global oil shipping route — has disrupted supply and pushed prices higher.

Ramaphosa told the delegates that the war, which continues to rage in the Middle East, is driving energy prices higher, which has also started to lead to increased food prices.

He has now set up a ministerial task team to urgently look into how the country can be cushioned from the war’s implications.

The Sunday Times understands that the team will include Godongwana, mineral resources minister Gwede Mantashe, electricity & energy minister Kgosientsho Ramokgopa, and trade & industry minister Parks Tau.

Now, as the ANC, we are saying we direct the government to address this matter to see how best we can address the challenges that South Africans are going to face as the price of petrol and diesel goes up.

—  President Cyril Ramaphosa

According to insiders, the team will look beyond just the fuel hike.

“It is quite urgent, yes, with a quick turnaround, but the scope of what they will be looking into is broader,” said an insider with intimate knowledge of discussions.

“They are not just looking at fuel prices; they are tasked with looking at the whole geopolitical situation and its implications for the country. They will then use that to drill down into the fuel price and how they can work around it.”

According to Ramaphosa, it is inevitable that fuel will rise next month because inflation has started to show signs of going up while interest rates will eventually start to fall.

“For South Africans it means higher fuel prices. By April 1, we are going to see prices of petrol and diesel going up, driven largely by the conflict that is going on,” said Ramaphosa.

He said Luthuli House has directed its deployees in government, including him, to devise immediate strategies that will reduce the impact on South Africans.

“Now, as the ANC, we are saying we direct the government to address this matter to see how best we can address the challenges that South Africans are going to face as the price of petrol and diesel goes up,” said Ramaphosa.

He said he has already held discussions with Godongwana about submitting a report on how South Africans can be cushioned in the immediate term.

There have been calls for the National Treasury to look into either suspending or lowering the fuel levy as a temporary measure, which would go a long way to halting a substantial increase in fuel and food prices.

Godongwana has told him “he’s also having sleepless nights because of what’s happening. I told him I’m not sleeping at all because of this challenge that our people are now facing,” said Ramaphosa.

“But I’ve said, as ANC president, he and other colleagues must address this matter and come up with solutions for what we should do now.”

Ramaphosa said he is worried that the increased cost of living for South Africans will create “more hardships, and it’s also going to create reduced fiscal space for our governments”.

“So all these challenges are being driven by the conflict that is going on. We need to find ways of controlling our own response,” he said.