SA’s energy dilemma: dependence vs security

WHEN oil prices rise during global crises, some countries count their profits.

- NYANISO QWESHA

Others count their losses. South Africa almost always falls into the second category.

That vulnerability is not just an energy problem. It is an economic one that shapes inflation, growth, and the cost of living for millions of South Africans. Every surge in global oil prices eventually shows up at home in higher fuel costs, more expensive transport, and rising prices at the supermarket.

As geopolitical tensions threaten to push crude prices higher again, energy-producing nations quietly prepare for windfall revenues. South Africa, by contrast, risks watching the moment pass it by now more precariously than ever.

At the centre of this dilemma stands PetroSA. For decades, the logic behind PetroSA was straightforward. A national oil company could provide South Africa with a strategic foothold in the petroleum industry, reduce vulnerability to global energy shocks, and help develop domestic resources. In theory, such an institution could support refining capacity, build technical expertise, and strengthen national energy security.

In practice, that vision has steadily eroded. South Africa today imports the overwhelming majority of its crude oil and refined petroleum products. When global oil prices surge, the consequences ripple quickly through the economy. Fuel prices climb. Transport costs rise. Inflationary pressures intensify. Farmers pay more to move crops to market. Manufacturers face higher logistics costs. Households feel the shock every time they fill their cars.

Energy dependence has quietly become an economic tax. The vulnerability is not hypothetical. The global energy system has already shown how quickly geopolitical conflict can disrupt supply and push prices upward. The Russia-Ukraine war triggered one of the sharpest energy price spikes in recent memory, forcing countries across Europe and Asia to scramble for alternative supplies.