Despite Reduced Oil Tax Cut, Fuel Prices Stabilize...Less Burden on Return and Departure Trips

140 Won Difference in Gasoline and 191 Won in Diesel Compared to Last Chuseok

[Asia Economy Reporter Donghoon Jeong] Although the fuel tax reduction was scaled back starting January this year, domestic gasoline and diesel prices have stabilized. The fuel prices, which had risen due to the Russia-Ukraine war since February last year, have returned to pre-war levels, easing the burden on travelers returning home for the Lunar New Year holiday.

According to the Korea National Oil Corporation's oil price information system OPINET on the 18th, the average nationwide gasoline price at gas stations was 1,559.99 KRW per liter, and diesel was 1,662.85 KRW per liter. Compared to September 8 last year, before Chuseok, when gasoline was 1,740.56 KRW per liter and diesel was 1,854.03 KRW, gasoline has dropped by 140.57 KRW per liter and diesel by 191.18 KRW. For a mid-sized car with a 70-liter tank, filling up gasoline costs 9,839 KRW and diesel 13,382 KRW, cheaper than the last Chuseok holiday travel.

Breaking down gasoline prices by region among the 17 cities and provinces nationwide, Jeju had the highest gasoline price at 1,650 KRW, followed by Seoul (1,650 KRW), Chungbuk (1,567 KRW), and Jeonnam (1,567 KRW). For diesel, Jeju was also the most expensive at 1,650 KRW among the 17 cities and provinces, followed by Gangwon (1,693 KRW), Jeonnam (1,692 KRW), Sejong (1,680 KRW), and Seoul (1,649 KRW).

Although the fuel tax reduction on gasoline purchases was reduced from 37% to 25% starting January 1 this year, the increase in fuel prices was limited. From January 1, the gasoline fuel tax rose from 516 KRW per liter to 615 KRW, an increase of 99 KRW. Compared to the nationwide average gasoline price of about 1,531 KRW per liter on December 31 last year, the price only rose by 28 KRW. Diesel prices, which were excluded from the fuel tax reduction due to their already high price level, are currently around 1,662.85 KRW per liter, actually decreasing by about 59 KRW. The price gap between gasoline and diesel, which once differed by about 200 KRW per liter, is also narrowing.

International oil prices are showing a downward stabilization trend. This is due to reduced energy demand caused by global demand contraction and a "warm winter" in Europe. The WTI (West Texas Intermediate) crude oil price per barrel was 92.81 USD on February 24 last year when the war broke out, soaring to 130.5 USD within two weeks. Oil prices, which had maintained around 100 USD until August last year, declined in the second half of last year due to concerns over a global economic slowdown, returning to pre-war levels.

Recently, Europe has experienced warmer weather than usual, reducing energy demand compared to previous years. Northern Spain and various parts of Switzerland saw temperatures exceed 20 degrees Celsius in early this month, and Warsaw, Poland, where the average January temperature is minus 2 degrees Celsius, recorded 18.9 degrees on New Year's Day. Currently, international oil prices are maintaining a level of 75 to 80 USD per barrel.

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