Government Considers Extending Fuel Tax Cut Period... Reviewing Petroleum Supply Plan

'Energy and Resource Supply Management TF 12th Meeting'
Decided to Promote Release of Stockpiled Oil in Case of Supply Instability

Gasoline prices at gas stations nationwide have been declining for six consecutive weeks since the government's fuel tax reduction measure in November. The price of gasoline in Seoul has dropped to the 1,600 KRW per liter range for the first time in five months. According to Opinet, the oil price information site operated by the Korea National Oil Corporation, the gasoline selling price in the fourth week of this month recorded 1,634.6 KRW per liter, down 14.3 KRW from the previous week. The photo shows a gas station in downtown Seoul on the 26th. Photo by Moon Honam munonam@

[Asia Economy Sejong=Reporter Dongwoo Lee] As tensions between Russia and Ukraine escalate, causing international oil prices to rise, the government is considering extending the fuel tax reduction measures beyond April. In case of future supply and demand instability, the government also plans to promote the release of reserve oil.

On the 9th, the Ministry of Trade, Industry and Energy held the 12th meeting of the 'Energy and Resource Supply Management Task Force' at the Korea Trade Insurance Corporation in Seoul, together with the Korea Petroleum Association, four major refiners, the Korea Energy Economics Institute, and the Korea National Oil Corporation, to review emergency oil supply response plans and announced this policy.

Park Ki-young, the 2nd Vice Minister of the Ministry of Trade, Industry and Energy, said at the meeting, "If the upward trend in international oil prices continues, we will continuously consult with related ministries such as the Ministry of Economy and Finance on measures to alleviate the burden on the national economy, including extending the fuel tax reduction period currently scheduled until April."

Recently, international oil prices have exceeded $90 due to geopolitical risks such as the Russia-Ukraine situation. Brent crude oil prices, which were $68.87 per barrel on December 1 last year, surged to $92.69 on the 7th of this month. Accordingly, domestic gasoline prices rose from 1,621.9 KRW per liter in the second week of January to 1,667.6 KRW in the first week of February. Some investment banks have also suggested the possibility of high oil prices exceeding $100 per barrel.

The refining industry stated at the meeting, "Although about 5.6% of domestic supply is imported from Russia, there is currently no disruption in domestic oil supply," and added, "In case of a crisis, we plan to respond by finding alternative import sources."

The Korea National Oil Corporation emphasized, "We are always maintaining a readiness to release government reserve oil in emergencies in preparation for possible supply crises," and added, "We will prepare additional response measures such as importing overseas crude oil in case of emergencies."

The Ministry of Trade, Industry and Energy requested the refiners attending the meeting to prioritize stabilizing domestic petroleum product prices and cooperate to minimize the impact of rapid oil price increases. It also urged them to conduct more thorough monitoring of domestic oil supply and demand and to respond promptly through government reserve oil releases if necessary.

Vice Minister Park said, "If the upward trend in international oil prices continues, we will continue to consult with related ministries such as the Ministry of Economy and Finance on measures to alleviate the burden on the national economy, including extending the fuel tax reduction period currently scheduled until April."

This content was produced with the assistance of AI translation services.