# summary - Link: https://dearsouthafrica.co.za/emergency-fuel-laws/summary/ - Published: 2026-07-10T15:51:20+02:00 - Author: dearSA _Advert_ _Advert – scroll down_ [ have your say](https://dearsouthafrica.co.za/emergency-fuel-laws/#havasay) South Africa’s energy landscape has hit a critical turning point. Following the permanent closure or conversion of major domestic refineries (such as SAPREF and ENGEN) into import terminals, South Africa has transitioned from a crude-oil-processing nation into a country heavily reliant on imported finished petroleum products. This leaves our economy highly exposed to global shipping bottlenecks, geopolitical conflicts, and severe price volatility. To counter this vulnerability, the Department of Mineral and Petroleum Resources has drafted the Strategic Petroleum Stock Policy, 2026. This policy moves South Africa away from a voluntary fuel storage model to a strict, legally mandated regulatory regime. It dictates exactly how much backup fuel the state and private companies must store, how those reserves are funded, and creates a legal framework for fuel rationing and state price-intervention auctions during global emergencies. According to the government’s data, a total nationwide unavailability of liquid fuel would cost the South African economy an estimated R1 Billion per day in lost GDP. Because it takes between 21 to 42 days for fuel imports to reach our shores, a robust backup plan is vital. However, the mechanisms chosen by the state will heavily dictate fuel costs, market competition, and individual consumer rights. ### _Key Policy Proposals Unpacked_ [The Dual-Obligation Stockholding Model](https://dearsouthafrica.co.za/emergency-fuel-laws/summary/#1738150189952-44103674-e29d31d9-c3be5520-254382c6-e76d) The policy divides the burden of safeguarding the country’s fuel security between the government and the private sector via a dual responsibility framework: - _State Strategic Stocks (60 Days Cover): _ The government mandates a reserve equivalent to 60 days of net imports. This will be managed by the newly consolidated South African National Petroleum Company (SANPC)—which emerged from the 2025 merger of the Strategic Fuel Fund (SFF), PetroSA, and iGas. These reserves will consist of 70% crude oil and 30% refined products (petrol, diesel, jet fuel) kept at state-owned storage hubs like Saldanha Bay and Milnerton. - _Private Mandatory Stocks (21 Days Cover): _ In a major shift, all licensed private wholesalers and fuel importers will be legally required to maintain 21 days of net import cover at their own expense. This stock must also follow a 70% crude and 30% finished product split to ensure quick market liquidity during disruptions. - _Product Quality Management: _ Because refined petroleum degrades over time, all stored finished products must be rotated at least every three months. [The Emergency Trigger Levels & Fuel Rationing](https://dearsouthafrica.co.za/emergency-fuel-laws/summary/#1738150189975-5d0623dc-47dc31d9-c3be5520-254382c6-e76d) The draft policy establishes four distinct action triggers based on the severity of a fuel shortage. Notably, it grants the Minister of Mineral and Petroleum Resources the sole authority to declare a liquid fuels emergency and alter market distributions: | **Emergency Level** | **Crisis Threshold** | **Mandated Government Action** | | **Level 1: Supply Alert** | Loss of 20% of national refined product supply (e.g., a refinery outage or single port closure) lasting more than 14 days. | Voluntary industry stock sharing and an immediate SANPC readiness audit. | | **Level 2: Supply Disruption** | Loss of 40% of national supply, alongside the total depletion of the private sector’s 21-day commercial safety buffer. | Initial restricted drawdown of state reserves, strictly limited to essential services and key economic hubs. | | **Level 3: National Emergency** | A severe global supply shock or complete failure of the import value chain, wiping out more than 50% of national fuel supply. | Mass state stock drawdown, wide market release, and the legal implementation of **fuel rationing** for consumers. | | **Economic / Price Stability Trigger** | Unprecedented global price volatility where Brent Crude oil hits or threatens to breach **$145 per barrel**. | The state will conduct a strategic sale of its stockpiled products via a competitive auction to deliberately force down local pump prices. | [Funding and Infrastructure Costs](https://dearsouthafrica.co.za/emergency-fuel-laws/summary/#1738150854013-bb98f5fb-7d0931d9-c3be5520-254382c6-e76d) Maintaining millions of barrels of emergency fuel requires massive capital. The policy proposes introducing a dedicated “security of supply” financial instrument or a cost-recovery framework via the Central Energy Fund Act to fund the state’s procurement and rotational costs. Additionally, it prioritises the refurbishment of the Saldanha Bay storage terminal and building new refined product mega-tanks closer to inland demand centres like Gauteng. ### _Questions and answers_ [Why is the government introducing a new fuel stock policy right now?](https://dearsouthafrica.co.za/emergency-fuel-laws/summary/#1763554389233-fdb8fee6-6da45520-254382c6-e76d) _The Reality: _ South Africa has experienced a massive shift in its energy security. Major domestic refineries, such as SAPREF and ENGEN, have either closed down or been converted into import terminals. _The Vulnerability: _ We have transitioned from a nation that imports raw crude oil and refines it locally to a nation that relies heavily on importing already finished petroleum products (like petrol and diesel). This leaves our entire economy exposed to international shipping delays, geopolitical conflicts, and currency drops. _The Risk: _ Government data indicates that a total national unavailability of liquid fuel would cost South Africa’s economy an estimated R1 Billion per day in lost Gross Domestic Product (GDP). [What is the main difference between our current system and this proposed policy?](https://dearsouthafrica.co.za/emergency-fuel-laws/summary/#1763554389265-aa09206a-77665520-254382c6-e76d) Currently, South Africa operates largely on a voluntary, commercial “just-in-time” fuel delivery model managed by private companies. This keeps corporate profits optimised but leaves the country with low physical reserves. This policy officially transitions South Africa into a regulated, mandatory regime where both the state and private businesses are legally forced to store massive volumes of backup fuel specifically for catastrophic disruptions. [Is the government really going to introduce fuel rationing?](https://dearsouthafrica.co.za/emergency-fuel-laws/summary/#1763554389298-fbc55a3c-817c5520-254382c6-e76d) Yes, but only in an extreme crisis. The draft policy introduces a strict three-level emergency trigger system. _The Trigger: _ Fuel rationing will only be legally implemented under a Level 3 National Emergency. This is defined as a severe global supply shock or total failure of the import value chain that wipes out more than 50% of South Africa’s fuel supply. _The Action: _ During a Level 3 emergency, the state will execute a mass drawdown of strategic stocks and legally enforce fuel rationing across the country to keep essential services running. [How will this policy affect the price of petrol and diesel at the pump?](https://dearsouthafrica.co.za/emergency-fuel-laws/summary/#1771840733358-e4b2d08e-b22682c6-e76d) There are two opposing impacts on pricing built into this policy: _1. Potential Price Hikes: _ The policy forces private oil companies and wholesalers to build infrastructure and store 21 days of backup fuel at their own expense. It also proposes a new state “cost-recovery framework” or financial instrument to fund government reserves. There is a strong likelihood that these heavy compliance costs will be passed down to ordinary citizens through higher retail fuel margins. _2. Potential Price Relief (The $145 Trigger): _ |Conversely, the policy creates an Economic/Price Stability Trigger. If global oil price volatility spikes and Brent Crude threatens to hit $145 per barrel, the Minister can release state fuel reserves into the market via a competitive auction specifically designed to force down local pump prices. [What are the new legal obligations for private fuel companies?](https://dearsouthafrica.co.za/emergency-fuel-laws/summary/#1771840767171-e194ee95-bf8282c6-e76d) If you are a licensed fuel manufacturer, wholesaler, or importer in South Africa, you will no longer be allowed to hold only what you intend to sell immediately. You will be legally mandated to maintain 21 days of net import cover as a private reserve. Furthermore, this backup stock cannot just be raw oil; it must be split 70% crude oil and 30% finished, refined product (like petrol or diesel) to ensure immediate market liquidity if a crisis hits. [Won’t stored fuel simply go bad or degrade over time?](https://dearsouthafrica.co.za/emergency-fuel-laws/summary/#1783690534482-9fffa819-6a9d) Yes, refined petroleum products degrade. To counter this, the policy explicitly mandates a quality control rotation mechanism. All private and state-owned refined strategic stocks must be completely rotated at least every three months and must be stored close to operational facilities to make this logistically viable. [Who is actually running and managing these fuel reserves?](https://dearsouthafrica.co.za/emergency-fuel-laws/summary/#1783690566172-716116dc-4505) _The Regulator: _ The Minister of Mineral and Petroleum Resources holds the ultimate executive authority to declare an emergency and trigger the release or sale of the fuel. _The Custodian: _ The day-to-day procurement, maintenance, and infrastructure management will be handled by the South African National Petroleum Company (SANPC). The SANPC is a new state entity formed by consolidating the Strategic Fuel Fund (SFF), PetroSA, and iGas. _The Logistics: _ Transnet Pipelines and Freight Rail will be responsible for moving the emergency fuel via the 700km Multi-Product Pipeline (MPP) from coastal storage hubs (like Saldanha Bay) to inland economic centres like Gauteng. In an emergency, Transnet is legally required to prioritise strategic fuel over commercial cargo. [Where will this emergency fuel be physically kept?](https://dearsouthafrica.co.za/emergency-fuel-laws/summary/#1783690637538-a08e106b-8472) Crude oil reserves will continue to be heavily focused at the massive state-owned storage facility in Saldanha Bay. However, because 60% of South Africa’s fuel is consumed inland (Gauteng, Limpopo, Free State, and North-West), the policy prioritises building new “mega-tank” storage infrastructure and strategic hubs closer to these high-demand inland centres for refined products. The draft Policy ⌊Loader⌉ Loading... ⌊EAD Logo⌉ Taking too long? ⌊Reload⌉ Reload document | [ ⌊Open⌉ Open in new tab ](https://cdn.dearsouthafrica.co.za/wp-content/uploads/2026/07/10153826/54975-09-7-2026-MineralPetroleumResource.pdf) [Download [952.54 KB] ](https://cdn.dearsouthafrica.co.za/wp-content/uploads/2026/07/10153826/54975-09-7-2026-MineralPetroleumResource.pdf) ### _In the News_ - BusinessTech — [New rules coming for petrol and diesel rationing, and a level 3 fuel shortage emergency in South Africa](https://businesstech.co.za/news/energy/866008/new-rules-petrol-and-diesel-rationing-and-a-level-3-fuel-shortage-emergency-in-south-africa/) - eNCA — [New rules proposed for strategic fuel stockpiles](https://www.enca.com/business-top-stories/new-rules-proposed-strategic-fuel-stockpiles) - MyBroadband — [New fuel rationing and emergency supply laws on the cards for South Africa](https://mybroadband.co.za/news/government/657603-new-fuel-rationing-and-emergency-supply-laws-on-the-cards-for-south-africa.html) - SA News — [Cabinet approves publication of petroleum stocks policy](https://www.sanews.gov.za/south-africa/cabinet-approves-publication-petroleum-stocks-policy) - News24 — [Cabinet approves emergency fuel stockpiles strategy](https://www.news24.com/business/economy/cabinet-approves-emergency-fuel-stockpiles-strategy-20260703-0790) - BusinessDay — [Mantashe aims for 60-day strategic fuel reserve buffer against shocks](https://www.businessday.co.za/news/2026-06-11-mantashe-aims-for-60-day-strategic-fuel-reserve-buffer/) - Energize — [SA plans 60-day petroleum reserve](https://www.energize.co.za/article/sa-plans-60-day-petroleum-reserve) - IOL — [South Africa’s 60-day reserve plan](https://iol.co.za/news/brics/2026-06-12-south-africas-60-day-reserve-plan/) ### _Statements and media releases_ Click on a logo to view. Want to display your organisation’s statement? [Click here. ](https://dearsouthafrica.co.za/emergency-fuel-laws/summary/ fuel@dearsouthafrica.co.za?subject=org info for New Fuel laws info page) Close ### Cape Independence Party **CAPEXIT Party strongly opposes the Business Licensing Bill in its entirety on all points:** **Preferential licensing** The Bill explicitly empowers the Minister to grant licences on a “preferential” basis and to impose conditions that advance “historically disadvantaged individuals” or other designated groups. This is nothing less than state-sanctioned racial and ideological discrimination dressed up as transformation policy. CAPEXIT rejects the notion that the state has any legitimate role in deciding which racial or social group may or may not operate a business. Such preferential licensing will: - Reintroduce apartheid-era economic controls under a new ideological banner; - Create a cronyist system where access to markets is determined by political connections and demographic criteria rather than merit, innovation or consumer demand; - Discourage both domestic and foreign investment, as investors will rightly fear that their businesses can be denied licences or subjected to arbitrary conditions on racial or political grounds. No free society licenses businesses on the basis of the owner’s skin colour or historical narrative. This clause alone renders the entire Bill unconstitutional and morally indefensible. **Principles of business licensing** The Bill fails to articulate any coherent, objective, or proportionate principle for requiring a general business licence in the first place. Instead, it presumes that every enterprise – from a street vendor to a multinational corporation – must seek prior permission from the state simply to exist and trade. This reverses the fundamental principle of a free economy: citizens should be free to engage in lawful economic activity without state permission unless there is a clear, evidence-based justification (e.g. public health, safety or environmental protection). The Bill provides no such justification. It is a blanket assault on economic freedom, reminiscent of the licence-permit raj that crippled India’s economy for decades. Requiring a general “business licence” in addition to existing sector-specific permits( liquor, health, zoning, etc.) serves no legitimate public purpose – only the purpose of expanding state control and creating new opportunities for rent-seeking and corruption. **Powers of inspectors** The Bill grants inspectors extraordinarily broad and invasive powers, including warrantless entry into private premises, seizure of documents and goods, and the ability to close businesses on the spot. These powers are ripe for abuse and will be weaponised against political opponents, non-compliant businesses, and any entrepreneur who refuses to pay bribes. In a country already plagued by corruption scandals, handing unelected officials the power to enter and shut down businesses without judicial oversight is an open invitation to extortion. Small businesses, spaza shops, and informal traders – many of them immigrant-owned – will be particularly vulnerable to harassment and shakedowns. Far from promoting transformation, this will simply create a new class of “licence inspectors” who enrich themselves at the expense of the poor. **More red tape** South Africa already ranks poorly on the World Bank’s Ease of Doing Business index, largely because of regulatory overreach. This Bill adds yet another layer of costly, time-consuming bureaucracy on top of SARS registration, municipal permits, B-BBEE compliance, UIF, COIDA, sector SETA requirements, and dozens of other licences. The compliance costs – application fees, mandatory consultations, endless paperwork, and the risk of arbitrary refusal – will crush startups and force thousands of small businesses to close or remain informal. Jobs will be lost, investment will flee, and the tax base will shrink. The Western Cape, which has consistently outperformed the rest of South Africa precisely because of lighter and more efficient regulation, will see its competitive advantage deliberately sabotaged by Pretoria. **Conclusion** The Business Licensing Bill is not reform – it is economic sabotage. It centralises power in the hands of an already overreaching and underperforming national government, reintroduces racial criteria into commerce, and erects new barriers to entrepreneurship at a time when South Africa desperately needs growth and jobs. CAPEXIT calls for the complete withdrawal of this Bill. The people of the Western Cape, and indeed all South Africans who believe in freedom, will not accept a return to a permit-based economy controlled by bureaucrats and political gatekeepers. For a free, prosperous, and non-racial future, this Bill must be rejected in its entirety.