Sasol shares lost more than 10% on Tuesday, losing some of the momentum that had been regained after a dramatic plunge following the revelation of cost overruns associated with the construction of the Lake Charles Chemicals Project in the US.
After opening at R152, the stock spiralled to close 10.23% lower at R92.20.
The share price drop comes as another storm heads towards the US Gulf Coast, with warnings extended to Louisiana, where Sasol's Lake Charles Chemicals Project is located. The Lake Charles project has already been affected by hurricane Delta and Hurricane Laura in recent months.
In August, Hurricane Laura knocked out electricity to the site for weeks, which caused damage to the plant, forcing it to shut.
However, David Shapiro, deputy chair of Sasfin Securities, speculated there could be several factors behind the share price dive, including a waning interest from Robinhood traders who had targeted Sasol stocks.
He said the US traders were believed to be behind a surprise recovery of the shares, buying Sasol shares in numbers around June - activity which could now be losing momentum. Their activity prompted an upward trend in prices following a slide prompted by the escalating financial cost of the US chemicals project.
The financial impact of the project, which overshot budget by around 45% to $12.9 billlion and forced the resignation of joint chief executives, Bongani Nqwababa and Stephen Cornell, shaved as much as 47% off the Sasol share price by the end of 2019.
"We might be seeing the unravelling of these traders as they get off the market and people get a better understanding of where the business is," said Shapiro.
According to a Bloomberg report, tropical storm Zeta was expected to make landfall in Louisiana late on Wednesday, and nearly 16% of oil production and 6% of natural gas was shut in across the Gulf.
Sasol said last week all the Lake Charles units that were operating prior to Hurricane Laura were expected to return to operation by the end of October 2020.