Government ‘closely watching’ the oil price and jet fuel situation – Creecy

Transport Minister Barbara Creecy says SA currently has “stability” on refined fuel and jet fuel supplies following the Middle East conflict, which has forced the closure of the Strait of Hormuz – a strategic sea channel for the Gulf’s oil industry. “We are closely watching the situation, the oil price and supplies, including jet fuel,” she told Moneyweb on the sidelines of the Board of Airline Representatives of South Africa’s (Barsa) Aviation Conference at the Capital Zimbali Resort on the KwaZulu-Natal North Coast on Thursday. The conflict, sparked by the US-Israeli airstrikes on Iran that killed its leader on the weekend, has rocked world markets and seen the Brent crude price spike to almost $85 a barrel.

Several Middle Eastern states, including aviation hubs Dubai and Qatar, have seen retaliatory strikes by Iran, which led to a shutdown of airspace and travel chaos in the region this week, with 15 000 flight cancellations. In SA, the rand’s significant weakening against the dollar since the strikes is expected to result in a double-whammy blow at the pumps in April, with petrol and diesel set to rocket between R2 and R5 a litre based on current calculations by Stanlib. “We are concerned about the situation in the Middle East and the closure of the Strait of Hormuz, which could potentially impact refined fuel supplies to SA and has seen a jump in global oil prices,” said Creecy.

A source at the Department of Mineral and Petroleum Resources told Moneyweb “there are no jet fuel concerns in the country” currently. He said it is difficult to tell how long it would be before the Middle East situation presents a challenge in terms of oil supplies locally. “The department together with the oil companies are monitoring the situation daily and whenever there are developments.” Mantashe weighed in on the conflict and its impact on Africa during an address in Zululand on Thursday.