Ministry of Trade, Industry and Energy: Price Ceiling System Can End Only If International Oil Prices Fall Below $100

'Daily Briefing of the Middle East War Response Headquarters'

Domestic Oil Prices Stabilize Following Fifth Price Ceiling Implementation

96 Percent of Gas Stations Nationwide Freeze Prices

Ki-wook Yang, Director General of Industry Resource Security at the Ministry of Trade, Industry and Energy, stated on May 14 that "the international oil price must fall below 100 dollars in order to end the petroleum price ceiling system."

On this day, Director General Yang made this remark regarding the prerequisites for ending the petroleum price ceiling system during the 'Daily Briefing of the Middle East War Response Headquarters' held at the Government Complex Sejong.

Gi-wook Yang, Director General of the Industrial Resource Security Office at the Ministry of Trade, Industry and Energy. Ministry of Trade, Industry and Energy

Director General Yang explained, "The price ceiling system is not a policy to be maintained in the long term, but if it is ended, there are concerns about the side effect of a sudden price surge," adding, "In order to relieve (the burden on consumers), the international oil price needs to fall below 100 dollars, potentially down to the 90-dollar range."

According to the Ministry of Trade, Industry and Energy, as of May 14, Brent crude oil, the benchmark for international oil prices, was 105.72 dollars per barrel, up 0.09% from the previous day and 48.3% higher than on February 27 before the outbreak of the war. After a decline on the 13th due to expectations from the U.S.-China summit, prices have since remained steady.

The government implemented the fifth petroleum price ceiling system starting at midnight on May 8. The price per liter is 1,934 won for gasoline and 1,923 won for diesel. According to the Ministry, since the fifth implementation, domestic gasoline and diesel prices have shown a downward trend starting from May 12. The price of gasoline decreased from 2,011.90 won on May 11 to 2,011.85 won on May 12, and further to 2,011.60 won on May 14. Diesel prices also dropped from 2,006.41 won on May 11 to 2,005.77 won on May 14.

Director General Yang emphasized, "Thanks to the participation of domestic gas stations in government price stabilization policies such as the petroleum price ceiling system, 96.1 percent, or the vast majority, have frozen prices, leading to a stabilization trend in domestic oil prices," and "Compared to before the outbreak of the war, the rate of increase in domestic oil prices remains stable relative to overseas markets."

The government plans to establish standards this month for compensating refiners' losses incurred by the implementation of the petroleum price ceiling system. An official from the Ministry of Trade, Industry and Energy said, "During the cabinet meeting, it was announced that the settlement criteria would be established by the end of May, and we are already communicating with the refiners regarding this," adding, "The principle is to calculate costs and compensate for losses, and in addition, we are discussing detailed aspects such as differences and commonalities among refiners in calculation methods, including import cost and production cost."

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