The 2010 Open champion entered the weekend two shots behind fellow South African Charl Schwartzel but the 2011 Masters winner will now have to do the chasing after a disappointing 72.
Oosthuizen moved to 14 under at Randpark Golf Club, with England’s Matt Wallace and Zambian world No. 1,330 Madalitso Muthiya at 11 under alongside Schwartzel.
Oosthuizen holed a long putt for birdie on the first and capitalised on the par-five fourth before handing the shot straight back on the next.
An excellent approach into the sixth helped him turn in 33 and he completed a hat-trick of birdies on par fives as he got up and down from bunkers on the 12th and 14th before birdieing the par-three 15th from 15 feet for a four-shot lead.
Scotland’s Bob McIntyre and four-time major champion Ernie Els are in a group of eight players six shots off the lead.
McIntyre, in his rookie season on the Tour, shot 68. Fellow Scot Ewen Ferguson is three shots further back after a 71 while Marc Warren is another stroke behind after a 70.