Gasoline and diesel prices in South Korea saw a moderate rise on Sunday, with the government contemplating a price cap system due to concerns over escalating energy costs following the Middle East conflict. Data from the Korea National Oil Corp. revealed that the nationwide average gasoline price stood at 1,893.3 won (US$1.27) per liter, marking a 3.9 won increase from the previous day. Similarly, diesel prices climbed by 4.8 won to reach 1,915.4 won per liter, as reported by Yonhap news agency.
In Seoul, fuel prices also experienced an uptick, albeit with limited gains. The average gasoline price in the capital city reached 1,944.7 won per liter, reflecting a 3 won surge from the previous day, while diesel prices rose by 4.9 won to 1,968.2 won. Despite the increases, the rate of rise was notably slower compared to recent spikes, hinting at potential government interventions to curb the upward trajectory.
Sources indicated that the government is exploring the adoption of a price cap system after rapid global crude price surges quickly impacted domestic fuel costs following recent U.S.-Israeli actions against Iran and subsequent retaliatory measures by Tehran. South Korea, heavily reliant on energy imports, remains susceptible to external price fluctuations that often trigger inflation concerns.
Amid mounting worries over soaring energy expenses linked to the Middle East tensions, South Korea is reportedly mulling over the implementation of an oil price cap system for the first time in nearly three decades. Officials initiated discussions following the swift transmission of surging global crude prices to domestic fuel rates, deviating from the usual delay of around two weeks, in the wake of recent geopolitical events. Given its energy import dependency, South Korea faces heightened vulnerability to external price shocks that can fuel inflation concerns.
