The Government has failed to secure alternative sources of crude oil at futures prices from Nigeria in the wake of US sanctions against Iran. So we now pay premiums for spot crude to compensate.
Iran traditionally supplies 25 percent of South Africa’s crude oil, exposing us to considerable supply-side risk. Nigeria is one of the few suitable alternative suppliers of crude, given that our refineries are not equipped to deal with the high-sulphur crude from suppliers such as Saudi Arabia.
Source: The Star Business Report