Petrochemicals giant Sasol yesterday rallied 16.34percent to R117.50 a share on the oil price rally.   Bloomberg
Petrochemicals giant Sasol yesterday rallied 16.34percent to R117.50 a share on the oil price rally. Bloomberg

Sasol shares gain more than 16% on world oil price rally

By Dineo Faku Time of article published Jun 3, 2020

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JOHANNESBURG - Petrochemicals giant Sasol yesterday rallied 16.34percent to R117.50 a share on the oil price rally, following reports that members of Opec want to extend record production cuts for at least one month.

Brent crude, oil’s international benchmark, strengthened as much as 1.09 percent to $39 (R679.32) a barrel. The West Texas Intermediate crude futures, which is the oil benchmark in the US, jumped to $35.9 a barrel, a 1.33percent jump from the previous day’s close of $35.44 a barrel.

Reports emerged yesterday that Opec and non-Opec oil-producing nations were set to meet this week to discuss the possibility of extending oil production cuts through next month or August. Brent crude has nearly doubled from $19 a barrel in April when global lockdown dented demand.

Annabel Bishop, the chief economist at Investec, said the sharp oil price rise would lift the petrol price. “The near doubling is currently estimated to push up the petrol price by R1.18 a litre in June, a likely unexpected increase for many, with many believing that oil prices, and inflation would stay low this year instead,” said Bishop.

Bishop said the recent rand strength, with the domestic currency reaching R17.30 to the dollar yesterday, had been insufficient to counterbalance the sharp rise in the oil price. “The movement in the exchange rate so far only indicates a 6cents a litre cut, in the face of a R1.22 a litre hike in the petrol price signalled by the jump in oil prices,” Bishop said.

Separately yesterday Sasol said it had appointed Priscillah Mabelane as executive vice-president for its energy business. Mabelane, who has been appointed effective September 1, succeeds Maurice Radebe, who retires from Sasol on September 1 after 16 years with the group.

Sasol president and chief executive Fleetwood Grobler said: “We are delighted to have a leader of Priscillah’s calibre join Sasol. We wish her a long and illustrious career with us and look forward to benefiting from her extensive business and leadership experience.”

Mabelane, who was the first woman chief executive of an oil company when she became BP Southern Africa’s chief executive in 2017, will serve as a member of Sasol’s group executive committee, the company said. Mabelane has also served as chief financial officer at Airports Company of South Africa and tax director at Ernst & Young.

BUSINESS REPORT 

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