by Ntandoyenkosi Ncube
JOHANNESBURG, March 12 (Xinhua) -- South Africa's fuel supply is expected to remain stable in the short term despite escalating geopolitical tensions in the Middle East, but consumers may face a significant price hike in the coming months, according to Johannesburg-based energy economist Lungile Mashele.
South Africa currently holds adequate reserves and retains some domestic refining capacity, which should sustain supply stability through at least May, she said.
"Our supply will be okay until May. We do have reserves and some refining capacity in the country. We have also diversified our sources of crude and imported fuel," Mashele told Xinhua.
However, pressure could emerge within specific fuel categories, particularly diesel and jet fuel, which are vital to key economic sectors, she warned.
South Africa is heavily reliant on imported refined fuel, leaving it vulnerable to global supply disruptions and shipping delays.
Mashele highlighted that the country imports approximately 80 percent of its diesel requirements, exposing it to significant external shocks.
"Relying on fuel imports leaves us highly vulnerable to supply shocks and fluctuating refining margins," she said. "Furthermore, any delays in transit could result in 'off-spec' products that fail to meet required standards."
Diesel is the backbone of the South African economy, powering agriculture, manufacturing, electricity generation, logistics, and public transport, and any disruption in its supply could trigger wide-reaching consequences across multiple industries, Mashele said.
Even if physical supply remains intact, she cautioned, rising global oil prices will likely translate into a sharp increase in local pump prices during the next adjustment cycle.
"April is expected to bring a significant fuel price shock," Mashele said, citing large under-recoveries in the fuel pricing system. "It is too early to determine the exact magnitude, but even if crude prices normalize, production shutdowns in some areas will take weeks to regularize."
Escalating Middle East tensions continue to drive global oil prices upward.
These geopolitical conflicts often disrupt global supply chains, particularly by choking critical shipping routes like the Strait of Hormuz, through which roughly 20 percent of the world's oil supply passes, Mashele said.
"Wars alter supply," she said. "The Strait of Hormuz is effectively a bottleneck. This chokehold has resulted in production facilities closing, deliveries being halted, and declarations of force majeure, causing prices to rise exponentially."
These disruptions, Mashele added, directly translate into higher costs for South African consumers.
To shield households and businesses from these shocks, she suggested that the government consider short-term relief. "Measures could include releasing strategic reserves, providing subsidies, or suspending the General Fuel Levy and the Road Accident Fund levy."
In the long term, Mashele said, strengthening energy security requires structural reforms to reduce import dependency. This includes expanding storage capacity, further diversifying supply sources, and incentivizing domestic oil and gas exploration through a clear regulatory framework.
"A robust regulatory, policy, and investment framework for the upstream, midstream, and downstream sectors is essential for South Africa to reduce its vulnerability to global geopolitical shocks," she said. Enditem
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