RED SEA CHAOS: Fuel on the fire — there’s a Trumpian upside to the global oil crisis
South Africa could not avoid the latest fuel price increase because the Houthis choked off Saudi Arabia’s Red Sea exit, but that starts another conversation altogether about who benefits.
South Africa faced a recent fuel price increase due to Houthi attacks on Saudi Arabia's Red Sea exit, straining fuel providers who pay unprecedented premiums for diesel imports. The self-adjusting slate levy, triggered when cumulative negative balances exceed R500-million, contributed to the recent price hike. Houthi attacks disrupted fuel supplies through supply disruptions, increased shipping and insurance costs, and higher refining margins.
The crisis caused a surge in diesel prices, which tripled from $85 to $210 per barrel, affecting various sectors like heavy transport, trucking, agriculture, and global shipping. This fuel price surge triggered inflationary pressure across consumer goods, food, and freight. Despite Saudi Arabia's low extraction costs, the surcharge made Middle Eastern crude as expensive as Venezuelan and US production.
The fuel crisis has also impacted Venezuela, causing electricity outages and narrowing its customer base, while US-controlled territories now have parity with Brent barrels from Saudi.
Written by urgent.news from Daily Maverick's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
