The renewed conflict in the Middle East – and the persistent vulnerability of fuel transport through the Strait of Hormuz – has exposed a structural truth: energy security is no longer just about supply; it’s also about exposure to a global energy system still dominated in many countries by fossil fuels. For South Africa, that exposure is even more tightly bound to an economy built on a carbon-intensive energy system, with its economic lifeblood, transportation, mainly reliant on imported fossil fuels. I recently heard someone quip, “Imagine if we still had load shedding and no diesel to power the generators, and no diesel to transport the diesel to the generators in the first place” – funny, not funny.

Against this backdrop, what appears to be another geopolitical energy shock should be read as a strategic signal – one that sharpens the urgency of reducing the world’s dependency on fossil fuels by accelerating both the global and domestic green energy transition. And clearly, the green energy transition is happening in real time. According to the International Energy Agency (IEA), as shown in the graphs below, in 2023 around 40% of global electricity generation came from renewable energy, and by 2025 almost 60% of growth in energy demand was composed of renewables. One shudders to think what this energy shock would have done to global electricity generation and usage without a renewables option – load shedding on a whole new level.

A system exposed, not just stressed

South Africa’s fuel system continues to function, and in the near term, the risk is rising prices rather than physical shortages. But that framing understates the issue. The Strait of Hormuz carries a significant share of global oil, gas (LNG), and associated products (fertiliser and petrochemicals); any disruption – real or anticipated – feeds directly into global pricing for industries and sectors reliant on these commodities.

For South Africa, a net importer of refined petroleum products, this is not a distant concern. It transmits into inflation, currency volatility, and broader economic pressure. All of which exacerbates existing social fragility. How much more can the South African consumer bear?

The lesson is increasingly clear: fossil fuel dependence embeds geopolitical risk at the heart of the economy. However, the solution is not as clear-cut.

Sasol: strategic asset or transitional relic?

Sasol occupies a unique position in this equation. Its coal-to-liquids operations supply roughly a third – by some estimates, closer to 30% to 40% – of South Africa’s liquid fuel needs. In times of global disruption, this domestic production acts as a buffer. However, in recent years, Sasol has decoupled from oil despite a more supportive pricing environment. While earnings remain leveraged to energy and chemical prices, its market valuation reflects concerns around execution, as well as sustainability, specifically its carbon tax overhang.

While there has been some progress in aligning its global operations with the goals set out in the Paris Agreement, including the introduction of an ambitious renewable energy programme and a renewed focus on producing green fuels, as well as the submission of a carbon tax budget, Sasol’s model remains carbon-intensive, placing it at odds with both global decarbonisation trends and South Africa’s own climate commitments. Essentially, what secures the present may complicate the future.

This duality defines Sasol’s role: simultaneously a cornerstone of energy security, an employment provider, the largest taxpayer, and a symbol of transition risk.

The deeper risk: path dependency

South Africa’s shrinking refining capacity and growing reliance on imports have quietly increased exposure to global shocks. But the more consequential risk is path dependency. Every delay in diversifying the energy mix prolongs vulnerability to geopolitical volatility. Each incremental investment in fossil fuel infrastructure – whether oil or gas – extends that exposure over decades.

The Strait of Hormuz is not just a chokepoint for supply. It is a reminder that legacy energy systems carry embedded fragilities that cannot be hedged indefinitely.

Reframing the green transition

The green transition is often framed as an environmental imperative; however, increasingly, it is a geopolitical necessity. Renewable energy sources – particularly solar and wind – offer what fossil fuels cannot: domestically generated, sovereign energy. South Africa’s natural resource base is globally competitive, positioning the country to reduce reliance on imported fuels over time.

This reframes the investment case. Clean energy is not only about emissions reduction; it is about insulating the economy from external shocks, stabilising long-term costs, and strengthening energy independence. In this context, the current crisis in the Middle East should be accelerating – not delaying – the transition.

Opportunities in disruption

The current environment presents a clear set of opportunities:

• Energy resilience as an investment theme: Renewable generation, storage, and grid expansion offer both sustainability and risk mitigation benefits.
• Industrial transition: Decarbonised growth in carbon-intensive sectors – including Sasol – creates pathways into green fuels, hydrogen, and future export markets.
• Policy leverage: Clear, consistent regulation can unlock capital, particularly as investors increasingly price in both climate and geopolitical risk.

Constraints that cannot be ignored

We know that acceleration is not automatic. South Africa faces structural barriers such as grid constraints, policy uncertainty, capital limitations, and execution risk. There is also a timing and cost mismatch. The benefits of renewables are structural and long term, while fossil fuel risks are immediate and often carry lower short-term cost implications. Managing this transition without destabilising the energy system requires coordination, credibility, and pace.

From vulnerability to agency

The Middle East conflict and the fragility of the Strait of Hormuz have not created a new reality – they have clarified an existing one. Energy systems reliant on imported fossil fuels are inherently exposed.

For South Africa, the green transition is no longer just about meeting climate commitments. It is about reducing dependence on volatile global supply chains, managing macroeconomic risk, and building a more sovereign energy future. Because in a world of recurring shocks, resilience is not incidental to the energy system – it is the objective.