Fuel Prices, Not Supply, Emerge as South Africa’s Immediate Oil Risk

Fuel Prices, Not Supply, Emerge as South Africa’s Immediate Oil Risk. South Africa’s immediate fuel challenge is expected to centre on rising prices rather than supply shortages, according to Mineral and Petroleum Resources Minister Gwede Mantashe.

Speaking during an Economic Cluster question session in the National Assembly, Mantashe said the country has enough crude oil reserves for about 30 days, while Sasol has adequate coal reserves to support fuel production, according to SABC News.

The minister said there was no threat of a fuel supply shortage, but warned that pricing remained a concern. He also said disruptions in the Middle East and the Strait of Hormuz were having a direct effect on both the supply and cost of petroleum.

Global oil prices have increased amid the conflict involving Israel, the United States and Iran, contributing to higher fuel costs internationally.

Bongani Motsa, chief economist at the Minerals Council South Africa, warned that fuel prices in South Africa were likely to remain above levels recorded before the conflict despite recent moderation in international prices.

Projections from the Central Energy Fund indicate that petrol and diesel prices could increase significantly when the Department of Mineral and Petroleum Resources announces the official adjustments early next week.

According to the projections cited by Independent Online, the price of 95 Unleaded petrol could increase by about R3.21 per litre, while 93 Unleaded petrol could rise by approximately R3.01.

Diesel prices are projected to increase by between R2.75 per litre for 500ppm diesel and R3.15 for 50ppm diesel.

If the projected increases are implemented, fuel prices would reach new levels in South Africa. The price of 95 Unleaded petrol could rise to about R29.26 per litre at the coast and R30.13 in Gauteng.

The projected price for 93 Unleaded petrol is about R29.93 per litre.

For diesel, the wholesale price of 500ppm could reach approximately R30.98 per litre at the coast and R31.86 inland.

The projections remain subject to the official fuel price announcement by the Department of Mineral and Petroleum Resources.