Prosecutors in Seoul announced on Monday the indictment of major domestic refiner HD Hyundai Oilbank and two company officials in a price-fixing case worth $17 billion post the US-Iran war outbreak. The company is alleged to have colluded to increase petroleum product prices following the surge in global energy prices after the war. Two officials from HD Hyundai Oilbank’s pricing department are also facing charges in this case.
Prosecutors have accused HD Hyundai Oilbank and another refiner, SK Energy Co., of engaging in direct collusion amounting to $14.2 billion. Additionally, two other refiners, GS Caltex Corp. and S-Oil Corp., are implicated for matching the rigged price hikes, collectively impacting market competition by around $17 billion. SK Energy was not indicted under a leniency program, while GS Caltex Corp. and S-Oil Corp. did not face charges due to activities not violating fair trade laws.
The investigation revealed that HD Hyundai Oilbank and SK Energy coordinated on the timing and extent of price increases for petroleum products post the war. GS Caltex and S-Oil, influenced by the pricing strategies of HD Hyundai Oilbank and SK Energy in the domestic market, followed suit with price hikes, leading to overall price escalations in the country, as per the prosecution.
Despite having substantial crude oil reserves at the war’s onset, the refiners aggressively implemented price hikes. The prosecution characterized the collusion post-war as not a momentary deviation but an ongoing practice during an international crisis. Separately, the four companies were indicted for unfair trade act violations by pressuring independent gas stations into purchasing their products through unjust contracts.
Moreover, the prosecution accused the refiners of preventing these gas stations from procuring cheaper products elsewhere by initiating lawsuits and halting consumer benefits. An employee each from HD Hyundai Oilbank and GS Caltex faced charges for destroying evidence related to the Fair Trade Commission’s inspection of the refiners in March.
