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S. Korea Warns Oil Refiners Over "Excessive" Price Hikes Amid Mideast Crisis

South Korea's Industry Minister Kim Jung-kwan has called on major oil refiners to refrain from excessively raising prices, stressing that the burden of rising international oil costs should not be unilaterally passed to consumers. The warning comes as domestic gasoline prices in Seoul have surged to a nearly four-year high following recent Middle East tensions. The government has issued a precautionary resources crisis alert and is working to secure alternative oil supplies while considering a potential release of reserves. Authorities are also conducting a crackdown on unfair market practices and may adopt an oil price cap system for the first time in decades.

Key Points: S. Korea Urges Oil Refiners to Avoid Excessive Price Hikes

  • Minister warns against exploiting oil price surge
  • Gasoline prices hit 4-year high in Seoul
  • Government issues resources crisis alert
  • Crackdown on unfair market practices launched
  • Price cap system for oil under consideration
2 min read

S. Korea urges oil refiners to refrain from excessive price hikes

South Korea's industry minister calls for fair pricing as gasoline prices surge, warning of grave responses to practices that hurt consumers.

"We ask that transparent and fair petroleum pricing be implemented - Kim Jung-kwan"

Seoul, March 9

Industry Minister Kim Jung-kwan on Monday called on major oil refiners to refrain from excessively raising prices amid a recent surge in international crude oil prices due to the ongoing Middle East situation, his office said.

"We ask that transparent and fair petroleum pricing be implemented to ensure that the burden of rising international oil prices due to the recent situation in the Middle East is not unilaterally or excessively passed on to consumers," Kim said in a meeting with oil refinery industry representatives and related authorities in Seoul, according to the Ministry of Trade, Industry and Resources.

Officials from SK Energy, GS Caltex, S-Oil, and HD Hyundai Oil Bank attended the meeting, reports Yonhap news agency.

Kim noted that although domestic oil prices normally reflect a change in global oil prices with a two-week term, prices here have escalated swiftly after the United States and Israel initiated airstrikes against Iran last week.

The minister warned that any attempts to take advantage of rising international oil prices in a way that undermines efforts to stabilise people's livelihoods will be met with grave responses.

The average gasoline price in Seoul topped 1,900 won ($1.28) per litre for the first time in nearly four years on Friday and further rose to 1,945 won as of Sunday, according to data compiled by the Korea National Oil Corp.

Amid public criticism, the Korea Oil Station Association earlier said the primary reason behind the recent jump in domestic fuel prices was the supply price hike by oil refineries.

The government has issued a precautionary alert on a possible resources crisis last week to preemptively respond to volatility in the energy market amid continuing turmoil in the Middle East, working to secure additional oil supplies from regions other than the Middle East and devising a detailed plan for the potential release of oil reserves.

The government is also conducting an intensive crackdown on unfair market practices involving energy supplies while considering adopting a price cap system for oil for the first time in nearly 30 years.

- IANS

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Reader Comments

P
Priya S
Interesting to see another Asian government taking action. In India, the oil marketing companies often cite "under-recoveries" when prices need to rise, but profits are always high. A transparent pricing mechanism is the need of the hour everywhere. Hope our policymakers are watching.
A
Aman W
While I appreciate the sentiment, just "urging" companies might not be enough. They need strong regulatory action and maybe a windfall tax on excessive profits during such crises. The burden always falls on the end consumer, whether in Seoul or Surat.
S
Sarah B
Living in Mumbai, I feel this deeply. My commute cost has gone up so much. It's not just petrol, it increases the cost of everything - vegetables, goods transport. Global events have a direct impact on our kitchen budget.
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Vikram M
The minister's warning about "grave responses" is good, but action speaks louder. In India, we need to diversify our energy sources faster. More focus on renewables and electric vehicles can reduce this dependency on volatile global oil markets.
K
Karthik V
Respectfully, while controlling prices is important, we must also be realistic. If international crude prices rise, refiners' input costs go up. They can't sell at a loss forever. The solution is a balanced approach, not just forcing companies to absorb all the shock. A sustainable model is needed.

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