South Africa ramps up fuel imports from US as war jolts trade
South Africa is boosting oil-product imports from the US to help replace lost supplies from the Middle East, in another example of how the conflict is reshaping trade and threatening higher costs for consumers.
Before the war, Africa’s top oil products importer sourced the bulk of its diesel, petrol and jet fuel from Gulf states — namely Oman, Saudi Arabia and the United Arab Emirates. But with flows through the key Strait of Hormuz choked off and oil prices now much higher, the nation has been forced to turn elsewhere.
At least four tankers unloaded about 165 000 tons of refined fuels from the US this month in Durban, where most of South Africa’s imports land, ship-tracking data compiled by Bloomberg show. That’s roughly twice the amount of American crude and fuel imports the country received in January, according to the US Energy Information Administration.
Another tanker has arrived in Durban and at least three more laden with American fuel are headed to the port before month-end, the data show. Switching to suppliers that are farther away can further add to import costs that have risen because of higher fuel prices and freight rates.
Countries and industries are trying to secure fuel following the severe hit on Middle East supplies. Asia’s emerging economies have borne the brunt of the energy crisis, with India, for example suffering liquefied petroleum gas shortages. Fuel crunches have also spread to other parts of the world, with Europe facing a deficit of jet fuel.
This week, the world’s largest oil traders warned that the rewiring of the oil market would take months even if a peace deal is agreed soon, and that flows through Hormuz may never return to normal.
“Product is available, albeit at a price, from alternative international supply sources,” Avhapfani Tshifularo, chief executive of the Fuels Industry Association of South Africa, said. “The US has been identified as one such source, and there appears to be a notable increase in fuel shipments originating from there.”
Africa’s most industrialised nation has become increasingly dependent on imports in recent years as refineries closed, partly amid a lack of investment. Almost 80% of its fuel imports land in Durban. Vessels unload at Island View Terminal jetties there, where TotalEnergies SE, Koninklijke Vopak NV, Glencore Plc-owned Astron Energy and Vitol Group’s Vivo Energy hold leases.
Nations around the world have raised fuel prices in the wake of the war, with South Africa increasing gasoline prices by the most in almost two decades as of April 1. The country is holding talks with importers and producers about how it calculates pump prices, according to Tshifularo and Vivo.
The price should be determined “with a transparent, market-reflective basket of alternative international supply sources for petrol, diesel and kerosene,” Tshifularo said.
The Department of Mineral Resources and Energy didn’t answer a request for comment.
“The pure flat price has gone up in terms of the market price, but your cost of shipping and freight and your premiums have gone up significantly because of that,” George Roberts, an executive vice president at Vivo, said last week. “There’s a balance that’s needed” to reflect new supply chain costs, he said, adding that talks with the government are underway.
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