00:06The U.S.-Israeli attacks on Iran will have far-reaching consequences for emerging markets.
00:13Already, higher oil prices have changed South Africa's economic trajectory.
00:18The price rise comes through into your inflation number.
00:20Because we now have a new inflation target of 3%, with a 1% leeway either side,
00:26we probably will breach that 1% leeway, and that would cause the Reserve Bank to possibly be forced to
00:32raise interest rates,
00:32even though that's not the right thing to do when you have a supply shop,
00:35but it might have to do it because it's establishing a new inflation target.
00:40Brand crude has surged more than 30% year-to-date and is expected to reach $120 as the war
00:47intensifies.
00:48South Africa being the net importer of oil and fuel,
00:53we know that most of our refineries have closed down.
00:57We don't have enough capacity in terms of refining.
00:59Even if we did, we still need oil to be shipped through the Strait of Hormuz, which is almost non
01:06-functional.
01:06So that is going to have a negative impact.
01:09We're going to have to import this oil at a higher price and also import fuel at a very high
01:15price.
01:15Rising oil prices have already started to filter into the South African economy,
01:19and it's going to be a double whammy for consumers next month.
01:24That's when prices at the pumps will go up and a new fuel levy is set to take effect.
01:30Fuel prices affect every individual.
01:34For those commuting with public transport and personal transport,
01:37having to fork out an extra cent is quite steep based on the cost of inflation that we are encountering
01:44in the country.
01:44I believe it's going to affect a lot of people as we know that we are facing actually unemployment.
01:50So I believe that we are going to be devastated.
01:53But what can we do?
01:55What really is going to devastate us?
01:58Higher fuel prices feed directly into transport, food and logistic costs,
02:04particularly through diesel, placing renewed pressure on households already struggling with elevated living costs.
02:10We're already dealing with higher administered prices in terms of the cost of electricity
02:17because NASA needs to make an adjustment for some errors that they made a couple of years ago.
02:22And the consumer is just going to pay.
02:24You've got high food prices already because of the foot and mouth disease.
02:29So there's a number of factors that are certainly working against the consumer.
02:33For businesses, especially in agriculture, mining and freight,
02:37a diesel spike could erode margins and delay investment decisions.
02:42We are not that far above zero.
02:43We are one and a half, you know, like that kind of 2% kind of growth targets for the
02:48next year.
02:49I think $10, sorry, oil price increase results in like what a $0.3 reduction in GDP growth.
02:56That really puts us into like negative economic growth.
03:03South Africa, like the rest of the world, is hoping for an end to the hostilities
03:07as it remains heavily dependent on a steady oil supply and stable oil prices
03:13to maintain economic stability.
03:15for a lot of people to make it small this year.
03:15You've got 120 million people.
03:16You've got 91 million people.
03:17You've got 84 million people.
03:19You've got 200 million people.
03:19But they started about 45 million people,
03:19And what's up is that 90 million people are staying healthy?
03:20Should you have 90 million people?
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