SA ‘highly exposed’ with just two weeks of fuel reserves

Concerns are mounting over South Africa’s fuel security as rising global oil prices threaten steep increases at the pump.

The government insists there is no immediate shortage. But economists warn the country is highly exposed, with strategic fuel reserves estimated at just 7.7 million barrels, roughly two weeks of supply.

The global benchmark is 90 days.

Anger over the 2016 sale of fuel stocks resurfaces

The current fuel crisis has reignited anger over South Africa’s 2016 decision to sell off most of its strategic fuel reserves.

Experts say the issue is not just the sale itself, but the failure to rebuild those reserves.

“I think the biggest problem is that we do have the capacity to store, and we haven’t filled those tanks,” said Maarten Van Doesburgh, Head of Economics at the Cape Peninsula University of Technology.

He said reserves should have been replenished when oil prices were lower.

‘We’re highly exposed’ to global shocks

With global oil prices climbing, South Africa’s limited reserves are now under pressure.

“To attempt to even refill those tanks at the moment at these prices is going to be catastrophic. We just don’t have the funding,” Van Doesburgh said.

He added that the country is ‘highly exposed’, warning that two weeks of reserves leave little room to absorb global supply disruptions.

Heavy reliance on imported fuel raises risk

South Africa’s vulnerability is compounded by its reliance on imported refined fuel.

While some crude oil is sourced from African countries like Nigeria and Angola, the country imports a large share of refined products.

“We’re a net importer of refined fuel,” Van Doesburgh said.

He noted that South Africa now refines less than 35% of its own fuel, down from about 80% previously.

Diesel is a major concern.

“We import about 75% of our refined diesel, so we’re at high risk,” he said.

Price hikes loom as options narrow

Motorists are already bracing for sharp increases.

Petrol prices are expected to rise by more than R4 per litre in the coming weeks, pushing prices close to R25 per litre.

That could mean about R1,250 to fill a 50-litre tank.

Van Doesburgh said there is little the government can do in the short term to cushion the blow.

“One of the things that could be looked at is delaying some of the tax increases,” he said.

But overall, he warned: “There’s very little one can do in the very short term.”

Calls for urgent action and accountability

With limited reserves and rising prices, pressure is building for urgent intervention.

Experts say measures may include reducing fuel consumption and reviewing policy decisions that left the country vulnerable.

The key question remains why reserves were not rebuilt after 2016, and whether South Africa is now paying the price.

For more information, listen to Van Doesburgh on CapeTalk’s Good Morning Cape Town with Lester Kiewit using the audio player below: