South Africa’s Fuel Supply: Navigating Geopolitical Tensions and Local Capacity Challenges
South Africa’s fuel supply is currently stable but increasingly vulnerable due to rising geopolitical tensions in the Middle East. Experts warn that heavy reliance on imported crude oil and decreased local refining capacity heightens the risk of supply chain disruptions, possibly leading to fuel rationing and long queues at petrol stations.
Current Fuel Supply Status
The Department of Mineral and Petroleum Resources (DMPR) has reassured the public that there is no immediate risk of fuel shortages in South Africa. Similarly, the Fuels Industry Association of South Africa (FIASA) supports this stance while noting that companies have begun implementing “controlled allocation measures” to ensure equitable fuel distribution. These measures include a ban on ad hoc demand to thwart market speculation and stockpiling by opportunistic buyers.
Local Refining Capacity Dwindles
Currently, South Africa operates just two crude oil refineries, NATREF and Astron Energy, in addition to the Sasol Secunda coal-to-liquids facility. This follows the permanent shutdown of two major local oil refineries in recent years, which has made the country more susceptible to supply chain disruptions. Energy expert Professor Vally Padayachee emphasizes that this reduced capacity represents a significant liability, stating, “South Africa’s reliance on only two operational crude oil refineries…leaves us vulnerable to supply chain risks.”
Geographical Reliance on Oil
James Lorimer, the DA spokesperson on Mineral and Petroleum Resources, acknowledges that while a potential shortage is a concern, it isn’t imminent. He highlighted that only 18% of South Africa’s crude oil originates from Saudi Arabia, with most sourced from West African nations like Nigeria, Angola, and Ghana. Approximately 40% of South Africa’s fuel consists of coal-derived resources (from Sasol), while 10% is produced by the NATREF refinery. The Astron refinery in the Western Cape also has adequate crude supplies at present.
The Issue of Processed Petrol Imports
However, Lorimer expressed concern regarding the importation of processed petrol. “A lot of our fuel, now that our other refineries are down, comes in as already processed petrol,” he stated, noting a dependency on overseas refineries, particularly in India and the UAE.
Monitoring Market Dynamics
The DMPR confirmed that the operational facilities primarily depend on crude oil imports from West Africa and increasingly from various countries across the African continent. Additionally, oil companies that previously sourced refined petroleum products from conflict-affected regions are actively seeking alternative supply sources to maintain uninterrupted fuel availability domestically.
To adapt to the evolving situation, FIASA and industry stakeholders are enhancing their monitoring efforts. Weekly meetings with the DMPR, Transnet, LPG wholesalers, and oil companies will shift to daily discussions from March 16, 2026, allowing for real-time coordination and decision-making.
Impacts of Rising Fuel Costs
Gavin Kelly, CEO of the Road Freight Association, warns that the consequences of escalating fuel prices will significantly affect the economy. “For an oil-importing economy like South Africa, higher domestic energy prices are inevitable,” he noted, stressing that increased fuel costs will ultimately be passed down to consumers, directly impacting the cost of goods.
Wider Economic Effects
Ernst van Biljon, head lecturer of Supply Chain Management at IMM Graduate School, pointed out that South Africa’s status as a net importer of crude oil means that rising global prices will directly hit domestic fuel costs, especially since road transport is vital to the logistics system. He emphasized the need for proactive planning to prevent production shutdowns and ensure effective supply chains.
Even with adequate supplies, Lorimer cautioned that fuel prices are almost guaranteed to rise. He estimates potential increases of about R3 per litre if geopolitical conflicts persist, particularly if the Strait of Hormuz remains closed for an extended period.
Concerns Over LPG Supply
As the peak winter demand period approaches, worries are also emerging about possible shortages of Liquefied Petroleum Gas (LPG). Although FIASA claims that LPG supply remains stable, Professor Padayachee considers the potential for scarcity a significant concern. He urged the government and industry to secure reliable local production to meet seasonal demands.
Long-Term Strategies Required
While the DMPR monitors the current situation closely, Professor Padayachee calls for a comprehensive long-term strategy. This should involve increasing local refining capacity, maintaining strategic reserves, and investing in renewable energy solutions to lessen dependency on imports. He further suggests learning from the Eskom crisis, focusing on energy security, resilience, and stakeholder collaboration.
Lorimer advises the public to stay informed about the situation but not to panic. Overall, a collective approach that prioritizes sustainability and preparedness is vital for navigating both domestic and international challenges surrounding fuel supply.
