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Fuel Overview

The major petroleum products that are sold in South Africa are petrol, diesel, jet fuel, illuminating paraffin, fuel oil, bitumen and liquefied petroleum gas (LPG). Petrol and diesel are the major liquid fuels that are used in South Africa. About 36 percent of the demand is met by synthetic fuels (synfuels), which are produced locally, largely from coal and from natural gas. Products refined locally from imported crude oil meet the remaining 64%. Refined petroleum products are produced by the following methods: crude oil refining; coal-to-liquid fuels and gas-to-liquid fuels (Sasol); and natural gas to liquid fuels (PetroSA), (see plate capacity below).

There are six refineries in the country - four on the coast and two inland (see picture below).

Petroleum products are moved from refineries by pipelines (see map of pipelines below), rail, sea and road to approximately 200 depots, 4 600 service stations and 100 000 direct consumers who are mostly farmers and other large scale industrial operations (mining). 

The liquid fuels industry was licensed in 2005 for the first time. The objectives of the licensing framework as detailed in the Petroleum Products Amendment Act 2003, Act 58 of 2003, include: Promoting an efficient manufacturing, wholesaling and retailing petroleum industry; Facilitating an environment conducive to efficient and commercially justifiable investment; Promoting the advancement of historically disadvantaged individuals; and Creating employment opportunities and small businesses in the petroleum sector. Manufacturers and wholesalers are prohibited from holding a retail licence except for training purposes, however they do have the option to franchise a service station to an independent dealer and directly supply it with petroleum products. There are also stations that are independently operated and unbranded. BP Southern Africa, Chevron South Africa, Engen Petroleum, PetroSA, Sasol Oil, Shell South Africa and Total South Africa are the main players in the South African oil industry. They operate storage terminals and distribution facilities throughout the country. The major role players in the South African liquid fuels market are government and its associated institutions, The Department of Energy (DOE) is responsible for ensuring the secure and sustainable provision of energy for socio-economic development. Through institutions like the Central Energy Fund (CEF) and National Energy Regulator of South Africa (NERSA), the government plays a significant role in the South African liquid fuels market. 

South Africa has no crude oil reserves of its own and about 64% of its fuel production stocks are dependent on crude oil requirements that are met by imports from the Middle East and Africa. The petrol price in South Africa is linked to the price of crude oil in international markets and is quoted in US dollars (US$) per barrel. Crude oil prices combined with the Rand/Dollar exchange rate therefore have a major impact on fuel prices, causing fluctuates in pricing throughout the value chaining and is regulated by the DOE with monthly adjustments to the selling price of the finished fuel product. A crude-oil refinery's biggest input cost is the crude oil component itself. In order for a refinery to make a profit, the price for the product manufactured from crude oil has to be higher than that of the crude oil price. When crude oil prices increase, the fuel price has to increase so that crude oil refineries are able to cover their own costs. In South Africa the main fuel products petrol and diesel are regulated by the DOE, with petrol price being regulated at the pump for end customer consumption and diesel price is regulated wholesale point.  

For more information on government and fuel provider contact details, please see the following links: 4.1 Government Contact List and 4.7 Fuel Providers Contact List.

Information may also be found at: http://www.mytravelcost.com/petrol-prices/ which is updated monthly. 

Fuel Pricing

The underlying principles for the basis of determination of the Basic Fuels Price (BFP) are to represent the realistic, market-related costs of importing a substantial portion of South Africa's liquid fuels requirements, and it is therefore deemed that such supplies are sourced from overseas refining centres capable of meeting South Africa's requirements in terms of both product quality and sustained supply considerations. The petrol price in South Africa is therefore directly linked to the price of petrol quoted in US dollars at refined petroleum export orientated refining centres in the Mediterranean area, the Arab Gulf and Singapore. This means that the domestic prices of fuels are influenced by (a) international crude oil prices, (b) international supply and demand balances for petroleum products and (c) the Rand/US Dollar exchange rate. The import parity (BFP) principle is an elegant, arms-length method of basic fuels price determination to ensure that local refineries compete with their international counterparts. This promotes cost efficiency and astute crude acquisition strategies to ensure survival in a volatile and competitive international environment, thus eliminating domestic inflationary pressures. 

International influence on the domestic prices of fuel include : Free-on Board (FOB) Values, Demurrage, Insurance, Ocean Loss, Cargo Dues (Wharfage), Coastal Storage and Stock Financing.

The BFP, quoted in USD/barrel or USD/ton is converted to US cents/litre by applying the international conversion rates (for example, barrels to tons, tons to gallons and gallons to litres) and is then converted to South African cents/litre by applying the applicable Rand/US Dollar exchange rate.

To arrive at the final petrol pump price in the different fuel pricing zones (magisterial district zones), domestic costs, imposts, levies and margins are added to the Basic Fuel Price (BFP). 

Domestic influence on the prices of fuel include : Inland Transport Costs, Wholesale Margin, Retail Profit-margin, Equalisation Fund, Fuel Tax, Customs and Excise, Road Accidents Fund, Slate, Demand Side Management on 95 Unleaded Petrol, IP tracer dye levy and Petroleum pipelines levy.

Information may also be found at http://www.energy.gov.za/files/petroleum_frame.html

Fuel Prices per Litre as of: 02 DEC 2020

(local currency and USD - $)

Petrol

14.46 ZAR / 0.98 USD

Diesel

12.49 ZAR / 0.85 USD

Paraffin

6.85 ZAR / 0.47 USD

Jet A-1

TBA

Information may also be found at http://www.energy.gov.za/files/petroleum_frame.html & https://www.aa.co.za/fuel-pricing updated monthly.

Seasonal Variations 

Some seasonal pressure may be expected on diesel availability, considering during winter period in South Africa (June to August) higher demands are put on the electrical power grid. The national power grid, being managed by power generation and distributer Eskom - a State Owned Company (SOC), and in some instances demand out strips supply. This deficiency of supply to meet demand is managed by the SOC with scheduled blackouts on parts of the grid for limited times and on a rotational basis. In severe instances to meet critical demand, backup diesel generators would be used to temporarily supplement the deficiency. During these scenarios diesel availability may be constrained, however production and imports will be adjusted to accommodate the temporary shortage until corrective action deliveries comes into circulation.

Seasonal Variations

Are there national priorities in the availability of fuel? (i.e. are there restrictions or priorities for the provision of fuel such as to the military?)

No

Is there a rationing system?

No

Is fuel to lower income / vulnerable groups subsidized?

No

Can the local industry expand fuel supply to meet humanitarian needs?

Yes

Is it possible for a humanitarian organization to directly contract a reputable supplier / distributor to provide its fuel needs?

Yes

Fuel Transportation

Petroleum products are moved from refineries by pipelines (the pipeline infrastructure is owned and operated by Transnet State Owned Company (SOC) refiners and importers contract with the SOC for transmission services via its infrastructure - designed to transmit fuel to and from South Africa’s refineries located at major centres and strategically to South Africa’s main economic hub - Johannesburg), rail (also owned and operated by Transnet SOC), sea (refiners may contract transport by means of time- and voyage charter of coastal tanker vessels, either individually or through joint ventures with other refiners) and road transport (by means of owned or contracted road-tankers) to approximately 200 depots, 4 600 service stations and 100 000 direct consumers – in the agricultural and mining sectors.

By means for this assessment South Africa’s liquid fuel industry would be able to accommodate an increase in demand from the humanitarian community, barring a dramatic event curtailing crude oil import supply channels.

Standards, Quality and Testing

Fuel standards are regulated by the Department of Energy (DOE) and its various instruments under the Amendment of Regulations regarding Petroleum Products Specifications and Standards Act all import, manufacture and blending for liquid fuels are regulated and are to meet the applicable code under the South African National Standards framework.

Industry Control Measures

Do tanks have adequate protection against water mixing with the fuel?

Yes

Are there filters in the system which monitor where fuel is loaded into aircraft?

Yes

Is there adequate epoxy coating of tanks on trucks?

Yes

Is there a presence of suitable firefighting equipment?

Yes

Standards Authority

Is there a national or regional standards authority?

Yes

If yes, please identify the appropriate national and/or regional authority.

South African Bureau of Standards

1 Dr Lategan Road, Private bag x191

Groenkloof, Pretoria 0001

012 428 7911

info@sabs.co.za

If yes, are the standards adequate/properly enforced?

Yes

Testing Laboratories

Are there national testing laboratories?

Yes

Fuel Quality Testing Laboratory

Company

Intertek South Africa - Bapsfontein (Minerals)

Name 

Not available

Address

Portion 113, Farm Elandsfontein, District Bapsfontein, 412JR, 1510, Gauteng, South Africa

Telephone and Fax

T : +27 105009977 , F : +27 0 11 574 5707

Contact

info.africa@intertek.com

Standards Used

ASTM, ISO, and IP test method protocols

Fuel Quality Testing Laboratory

Company

SGS SOUTH AFRICA (PTY) LTD

Name 

Not available

Address

Huawei Office Park, Building No 1, Western Service Road, Woodmead, 2191, South Africa

Telephone and Fax

T : +27 11 800 1000

Contact

Not available

Standards Used

ISO, EN and GOST


Disclaimer: Inclusion of company information in the LCA does not imply any business relationship between the supplier and WFP / Logistics Cluster, and is used solely as a determinant of services, and capacities.

Please note: WFP / Logistics Cluster maintain complete impartiality and are not in a position to endorse, comment on any company's suitability as a reputable service provider.





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