Page 11 - AfrOil Week 25 2022

AfrOil PERFORMANCE AfrOil

“We are collectively an industry. The central said.
bank, Energy Ministry and NPA are working He continued: “[There] is a risk of a crisis but
to address and mitigate that future risk. The we don’t have a crisis ... We have stocks to last a
central bank since March has been taking very month and a few more to come, but that does
proactive intervention for our market but also is not mean that there is enough comfort or cer-
limited,” Hosi said. tainty from the international market when they
He said that although the central bank was are seeing challenges with us making good our
providing dollars to Bulk Oil Distributing Com- dollar payments.”
panies (BDCs) through a special dispensation, it Hosi went on to say that the CBOD was
was not enough. working with the central bank to come up with
“The BoG started with giving BDCs 50% of an Oil FX Market, a special-purpose foreign
our required dollars. This has been scaled down exchange market for the industry that will cre-
to about 25%. We had to go to the open market ate more predictability and certainty for interna-
to buy additional forex to supplement it,” Hosi tional suppliers. ™

POLICY
South African opposition criticises energy

minister for call to buy cheap Russian oil

SOUTH AFRICA SOUTH Africa’s Mineral Resources and Energy country. It doesn’t help the people.”
Minister Gwede Mantashe has called for the South Africa has close historical ties with
country to purchase Russian crude oil, drawing Moscow, owing to the Soviet Union’s support
sharp criticism from opposition leaders, some for the anti-apartheid struggle. In May, Presi-
analysts and NGOs, according to a report from dent Cyril Ramaphosa lamented that “bystander
Voice of America (VOA). countries” in Africa and beyond were suffering
Noting that South Africa has three times this due to sanctions against Russia.
year abstained from voting on United Nations Foreign policy analyst Sanusha Naidu of the
resolutions condemning Russia’s invasion of Institute for Global Dialogue said she doesn’t
Ukraine, the broadcaster said that buying Rus- know what the solution to the high fuel price
sian oil would be in “flagrant disregard” of the is, but the South African government should be
sanctions against Putin’s government imposed doing more to avoid an economic crisis.
by the US, UK and EU. “The fact of the matter is that South Africa
During a parliamentary debate on domes- has not done what it should’ve done at a struc-
tic fuel prices, Mantashe said that South Africa tural level in terms of improving refining capac-
“should consider importing crude oil from Rus- ity, improving our own kind of capabilities,”
sia at a low price.” Naidu is quoted as saying.
Kevin Mileham of the opposition Dem- Like governments around the world, South
ocratic Alliance (DA) party responded by Africa has rolled out subsidies to ease pressure
describing Mantashe’s call as misguided. “South on consumers due to higher fuel costs. However,
Africa’s refining capacity is at an all-time low at experts say the fuel price in July could reach an
the moment with the majority of our refineries unprecedented $1.69 per litre, VOA reports. The
shut down, so we have no way of refining oil pur- South African government did not comment on
chased from Russia,” he was quoted as saying by Mantashe’s statement. ™
VOA.
According to Mileham, it would be easier and
cheaper for South Africa to purchase refined fuel
from refineries overseas like Singapore, the Mid-
dle East, Nigeria and Europe. The Democratic
Alliance is calling for taxes, which form part of
the fuel price, to be reduced.
Mining analyst Peter Major said Mantashe’s
call to consider buying Russia’s crude oil is an
inane comment that ignores the plight of the
Ukrainians and could reflect poorly on South
Africa. “It could turn a lot of people’s goodwill
away from us here if the party keeps making The Elandra Denali, a Liberian-flagged tanker carrying Russian crude oil,
statements like that,” he said. “It doesn’t help the made port in Saldanha Bay in May 2022 (Photo: LSC Ship Management)

Week 25 22•June•2022 www. NEWSBASE .com P11