The South African Chamber of Commerce and Industry (Sacci) has called for an immediate ceasefire in the Middle East, warning that continued conflict could deepen local economic pressure.
The appeal comes after the surge in crude oil prices amid escalating tensions in the Middle East, which threatens a sharp rise in cost for fuel-dependent sectors.
West Texas Intermediate (WTI) crude has traded between $98 (R1 656) and $100 per barrel this month, contributing to what Sacci described as under-recovery in South Africa’s fuel pricing structure.
According to WTI Trading Economics, markets turned sharply on Monday as US President Donald Trump signalled a potential easing of tensions.
WTI crude oil futures plunged more than 10% to around $88.5 per barrel after Trump ordered a five-day pause on planned US strikes against Iranian energy infrastructure.
The move followed what he described as constructive talks with Iran over the past two days aimed at resolving the conflict, with discussions set to continue this week.
Uncertainty remains high
According to WTI Trading Economics, the announcement helped ease fears over supply disruptions, particularly around the strategic Strait of Hormuz, a critical passage for global oil shipments.
Markets reacted quickly as the perceived risk to energy infrastructure declined, although uncertainty remained high.
Attention has now shifted to whether diplomatic efforts can secure a more lasting reopening of the key waterway and stabilise global supply.
Sunday World previously reported that Handré Retief, a portfolio manager at Novare Holdings, said the immediate market shock is awkward for South Africa, being a net importer of oil.
He explained that Brent crude prices feed directly into petrol and diesel costs, which constitute a meaningful portion of the consumer inflation basket.
He warned that a sustained oil price above $80 to $90 per barrel could add between two and four percentage points to inflation over the coming quarters if disruptions persist.
If tensions in the Middle East persist beyond three to four weeks, he warned, Brent crude oil could spike to $100 or even $200 per barrel.
Retief estimates the fallout could shave between 0.5% and 1% off South Africa’s gross domestic product, push bond yields toward 10% to 11%, and weigh heavily on cyclical sectors of the economy.
Sacci calls for restraint
Sacci said the instability in financial markets and the disruption to the supply routes and supply chain will negatively impact the global economy and show the deterioration in inflation, commodity prices, and exchange rates, among others.
“This situation does not bode well for any prospect of recovery that we should have anticipated as South Africa,” Sacci said.
“We call on all the warring parties to exercise restraint and careful judgement in calling for an immediate ceasefire.
“The adventure of wars cannot resolve disputes, and it is concerning that the multilateral institutions that have been built over the many decades are now unable to stamp their authority and ensure that rules are observed by all.”
