SASOL, previously known as the South African Coal, Oil, and Gas Corporation, is facing a challenging outlook, as outlined in its annual report to investors. The company is grappling with a declining petroleum business, exacerbated by the global and South African shift toward new-energy and more fuel-efficient vehicles in the transport sector.

The company recently experienced a significant drop in its share price and a R35-billion impairment due to concerns about heavy pollution at its facilities. SASOL informed investors that the demand for petrol remains weak in South Africa, primarily due to the cost-of-living crisis and rising fuel prices.

SASOL expressed concerns about the future of petrol, noting that the sales of new-energy and fuel-efficient vehicles are expected to increase in the latter part of the decade. Since a significant portion of its product portfolio consists of petrol, the company is exploring various technological options to mitigate the risk of oversupply in the South African market.

In addition to the challenges related to changing consumer preferences, SASOL is under pressure from both regulatory authorities and investors to reduce its emissions. Its liquid-fuels facility in Secunda, Mpumalanga, currently ranks as the world's largest emitter of Sulphur Dioxide (SO2). SASOL has until April 2025 to comply with the Air Quality Act's SO2 reduction requirements at the Secunda facility, failure of which could result in significant legal and financial consequences.

SASOL's CEO, Fleetwood Grobler, acknowledged the severity of the situation, stating that if the company cannot meet the emissions requirements and loses its operating license, a phased shutdown would likely be the outcome. Grobler emphasized that SASOL operates in a highly regulated industry, and the ongoing legal processes are a reflection of the challenges faced within this regulatory environment.