Renewed fears of inflation among investors have taken centre stage as the price of Brent crude rose above $100 per barrel on Wednesday.
Bianca Botes, Managing Director at Citadel Global said that impacting market sentiment was the surge in oil prices, hovering near the psychological landmark of $100 per barrel, an indication of rising economic pressures.
Brent prices surged 2.65% higher on Wednesday afternoon, as the price rose to $100.51 per barrel.
"Concerns over potential supply disruptions were heightened following reports of US strikes on Iranian tankers and Houthi attacks on Saudi energy facilities. Amid these geopolitical tensions, the price of gold also witnessed an upward tick, settling at $4412 per ounce on Wednesday, reflecting a growing demand for safe-haven assets in uncertain times," Botes said.
This was the first time since July 24, 2026 that the price of Brent breached the $100 mark, while the peak was reached in April when the price soared to $126.41 a barrel.
"The US economic calendar appeared relatively light on Wednesday, with the release of the ADP employment report and a closely watched 10-year Treasury auction expected to capture the market's attention. These indicators will set the stage for crucial data released on Thursday, on producer prices and weekly jobless claims, culminating in Friday's all-important Consumer Price Index (CPI) reading that is expected to shape the outlook for next week’s Federal Reserve meeting," Botes added.
Adding to the global economic narrative, China reported producer prices that exceeded expectations, rising 3.8% year-on-year, further indicating inflationary pressures at the international level.
In South Africa, the rand remained steady on Wednesday afternoon, trading at R16.01 to the US dollar, R18.65 to the euro, and R21.71 to the pound, reflecting a degree of stability in a turbulent global financial environment.
This also comes a day after South Africa’s gross domestic product (GDP) contracted by 0.2% in the second quarter of 2026, following growth of 0.4% in the first quarter, Stats SA reported on Tuesday.
North-West University Business School economist Professor Raymond Parsons said the figures confirmed the setback suffered by South Africa’s economy and other economies during the recent global energy shock.
“The prospect at the beginning of 2026 that the economy would immediately build on the incipient recovery seen in the second half of 2025 has unfortunately not been realised,” Parsons said.
He said finance, business services and transport remained leading sectors, while mining and manufacturing were lagging. Gross fixed capital formation, which is important for sustained, job-rich growth, had also disappointed.
Parsons said mixed high-frequency economic data from the third quarter suggested that the recovery had been interrupted and delayed, rather than definitively derailed.
The geopolitical tensions have severely affected oil supply through the strategic Strait of Hormuz throughout 2026, as higher oil prices heavily affect fuel prices in South Africa.
The official monthly adjustment of South African fuel prices depends on the basic fuel price (BFP) calculation, which is predominantly determined by the strength of the rand, international oil prices and other administered components.
What it could mean for October fuel prices
Further complicating the matter is that tanker traffic in the Strait of Hormuz has fallen to its lowest level since May.
September saw petrol prices increasing by R1.34 a litre, while diesel rose by between R2.94 and R3.15 a litre.
The September increase was driven largely by higher international oil and petroleum-product prices, with the stronger rand providing only limited relief.
Inland, 95 unleaded petrol now costs R26.92 a litre, while wholesale 50ppm diesel has moved above R30 a litre.
Now oil is moving sharply higher again.
South Africa's monthly fuel-price calculations are heavily influenced by international petroleum prices and the rand-dollar exchange rate. If crude remains elevated, that pressure can feed into the next pricing cycle.
It does not guarantee another increase. A stronger rand or a reversal in oil prices could soften the impact.
But the latest move in crude has put the risk firmly back on the table.
ashley.lechman@nationalmg.co.za