Bad News Never Stops
2 years ago South Africa had 4 refineries supplying the fuel needs of the country. As of Friday there was not one refinery working as 3 have shut down indefinitely and the National refinery has no crude to process.
The South African economy has been shot to pieces with any hope of recovery being ruined by the constant power outages. Businesses are in survival mode and many after years of financial pressure are on the brink. This is not only the small businesses but many of the big boys are feeling the strain.
SASOL South Africa's Government controlled refinery is feeling the heat as they shut their refinery down due to "supply chain" issues. they blame the non arrival of crude imports for the National refinery closing it's doors. This has resulted in the non manufacture of Petroleum related products which will have a knock on effect once they are back up and running.
We as manufacturers have been struggling since last year to obtain raw materials and are sick and tired of hearing hat there are shortages. You order 20 tons and are only delivered 10 tons if you are lucky. This cuts down the manufacturing capabilities as orders cannot be processed reducing profits.
The problem is South Africa used to have multiple refineries dotted around the country. BP and Shell shut down their SAPREF refinery in February which was the biggest Crude refinery in South Africa. This refinery processed 180 000 barrels of crude per day and represented 35% of SA's requirements.
It is actually worse than that as two other refineries closed in 2020 due to explosions and have never reopened. One in Cape Town that processed 100K barrels per day and one in Durban 120K barrels per day have left it all at the feet of SASOL who is struggling. I didn't know this until I researched how bad things really were and hits home how bad things really are. This is not surprising there are serious shortages of by products and this is only going to get worse.
2 years ago SASOL had the cheek to raise import duties on our raw materials so we were stuck with buying local and now they cannot even supply. South Africa requires 25 billion of fuel per year to meet the demand and are already importing more than 50% of those numbers. These numbers should rise to 70 % or more just by the number of refineries they have active which is a shocking stat.
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Yikes, that sounds pretty horrible. If it were just power, that might be one thing, but now you are talking fuel too. There is no way around that.
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Yes it is a combo deal and not just one that is screwed. Alarm bells are ringing loudly as this is not going to improve. Too many idiots in charge who have no clue and know someone, but know nothing about the job.
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Sounds like it!
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South Africa is on a road going nowhere, time is long overdue for people to realize the media is not always highlighting extreme problems.
Stats, unless you delve deep and do your own research is difficult to obtain, most stats are out dated if not being developed by private business enterprise.
Having promoted use of taxi services, burning other infrastructure to the ground, makes little to no difference now, railway services require electricity or diesel, neither available. Taxi services will shut down leaving commuters stranded, no one can run business under current conditions.
Rich get richer, smile don't frown, not much else one can say.
I had no idea so many refineries were now shut down and fills in the blanks why I cannot get raw material. The idiots increased import duties to protect themselves and cannot supply so not exactly fair. This is worrying as all the main industry is collapsing.
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Coming from paper industry we saw same stupid import duties applied early 2000's, shooting oneself in the foot is an understatement. Yes refinery here is a couple of miles down the road toward Durban, when they closed I said no one works so how are they planning to 'take over', sad facts that should be raised along with many other ills beseeching this country.
I know the Engen refinery well as was based on the Bluff in the army and lived in Durban for many years.
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Excuses in media, stretched stories.... our crude oil comes from Africa https://www.ceicdata.com/en/indicator/south-africa/crude-oil-imports - On top of that the sale of reserve stocks https://issafrica.org/iss-today/why-were-sas-oil-reserves-sold-illegally - When things go 'missing' there is always a 'plan' https://www.reuters.com/article/safrica-oil-idINL6N0SA1XO20141015
Why have the refineries shut down?
Two due to explosions 2 years ago which is odd as why haven't they reopened? Another shut in February and must have been a business call made by BP and Shell. The national refinery run by SASOL has no crude to process and blames deliveries which I just don't believe as they don't offload at the ports, but to a pipeline in the sea. Sounds like a combination of lack of maintenance and bad management. When you are importing the bulk of your fuel and not processing it the price has to be more expensive.
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Most unfortunate. Do any of the neighboring countries have spare refining capacity? How about importing refined petroleum products?
I have no clue. Angola would most likely be the one to turn to if they had to. Answer is to get the refineries back up and running and to order the correct amount of crude required.
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We will have to check what is available as the price was 20% more expensive. If there is nothing else available then the price makes no difference as everyone is buying at the same price.
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Shocking stats putting the economy in no other mode than the downhill, drastic measure are required to avert this for the better otherwise it is only going to get worse.
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