Fuel Tax Reduction Raises Gasoline Price by 30.3 Won per Liter... Ministry of Industry Requests Industry Cooperation for Price Stability

Oil Market Review Meeting

Since June 1st, the rate of fuel tax reduction has been reduced, resulting in a recent increase of 30 KRW per liter in gasoline prices at gas stations. The government has pledged to concentrate inter-ministerial efforts on price stabilization and urged the petroleum industry to also work towards alleviating the burden of living costs on the public.

The Ministry of Trade, Industry and Energy announced that Lee Ho-hyun, Director General of the Energy Policy Office, held a 'Petroleum Market Inspection Meeting' on the 11th with related ministries, industry representatives, and institutions.

At this meeting, representatives from the Ministry of Trade, Industry and Energy, Ministry of Economy and Finance, Ministry of Land, Infrastructure and Transport, National Tax Service, and Fair Trade Commission attended to share the inspection results on petroleum prices and quality by the 'Inter-Ministerial Petroleum Market Inspection Team,' which has been operating since October last year, as well as each ministry’s plans. Additionally, they reviewed recent petroleum price trends following the fuel tax restoration with industry and institutions.

The government reduced the fuel tax reduction rate starting from the 1st of this month. Accordingly, the reduction rate for gasoline changed from 25% to 20%, diesel from 37% to 30%, and liquefied petroleum gas (LPG) from 37% to 30%.

On the 1st, a citizen visiting the Mannam Square Discount Gas Station in Seocho-gu, Seoul, where the government decided to reduce the fuel tax cut rate, is refueling their vehicle. From this day until August 31, the fuel tax reduction rate for gasoline will be reduced from the existing 25% to 20%, and the reduction rate for diesel will be reduced from 37% to 30%. Accordingly, the fuel tax on gasoline will increase by 41 won from 615 won to 656 won per liter, and the fuel tax on diesel will also increase by 38 won from 369 won to 407 won. Photo by Jo Yongjun jun21@

The Inter-Ministerial Petroleum Market Inspection Team conducted on-site inspections at 66 gas stations, uncovering illegal activities at 10 stations (8 cases of supply and demand reporting violations and 2 cases of VAT reporting violations), and reported these findings to the relevant local governments and tax offices. Concurrently, from March to June this year, the Ministry of Trade, Industry and Energy carried out special inspections on petroleum prices and quality at 1,568 gas stations with a history of illegal activities to prevent illegal petroleum distribution taking advantage of high oil prices, detecting violations at 80 stations and notifying the respective local governments.

During the meeting, the Ministry also reviewed petroleum price trends following the implementation of the fuel tax restoration. Compared to May 30th, the nationwide gas station selling prices as of June 7th showed an increase of 30.3 KRW per liter for gasoline and 31.4 KRW for diesel, reflecting recent international oil price rises and the fuel tax restoration. The price increase at budget gas stations was relatively lower, with gasoline up by 24.6 KRW and diesel by 26.3 KRW.

Director Lee stated, "As the price increases due to the fuel tax restoration are being fully reflected starting this week, the government plans to consolidate the capabilities of each ministry to stabilize petroleum prices," and requested, "We ask the industry to actively participate in efforts to stabilize prices to ease the burden of living costs on the public."

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