South Korea has arranged around 50 million barrels of alternative oil supplies for this month to compensate for the disrupted Middle East oil shipments caused by the closure of the Strait of Hormuz. The government officials emphasized their commitment to ensuring stable energy supplies. Yang Ghi-wuk, the deputy minister for trade, industry, and resource security, mentioned that efforts are underway to secure oil from various countries like Saudi Arabia, Oman, Kazakhstan, and the United States.
Around 80 million barrels of oil typically reach South Korea monthly, but currently, approximately 50 million barrels have been provisionally secured for this month, with expectations of increased alternative supplies in May. To address the supply gap, the government is managing demand and collaborating with private companies through a crude oil swap system. They also plan to closely monitor the market situation to ensure supply stability.
In response to Australia’s proposed restrictions on natural gas exports, Yang stated that the impact on South Korea is anticipated to be minimal. Australia assured South Korea that its long-term gas supply contract would not be disrupted. Australia’s plans to limit natural gas exports primarily affect short-term spot contracts, potentially causing some disruptions in South Korea’s short-term gas supplies, amounting to around 30,000 to 40,000 tons, equivalent to half a day’s supply.
Industry Minister Kim Jung-kwan expressed strong determination to stabilize the supply of naphtha and other petrochemical materials amidst the disruptions stemming from the Middle East conflict. During a meeting with officials from relevant ministries and business associations, Kim emphasized the importance of naphtha as a crucial raw material for various industries and everyday products. He pledged to establish a secure petrochemical supply chain to safeguard people’s daily lives and industrial operations, while also promising a firm response to any market malpractices.
