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  • Second Special Prosecutor Extension Bill Passes in National Assembly Amid Opposition Claims of Political Suppression
    Second Special Prosecutor Extension Bill Passes in National Assembly Amid Opposition Claims of Political Suppression 2nd Special Prosecutor's investigation extension bill passed the National Assembly on July 21, led by the ruling party. The second special prosecutor, tasked with investigating remaining allegations following the three major special prosecutors (insurrection, Kim Geon-hee, and Chae Hae-byeong), will have its investigation period extended until August 23. During the session, the National Assembly approved the bill titled 'Partial Amendment to the Act on the Appointment of Special Prosecutors for Investigating Insurrection, Foreign Exchange, and State Affairs Manipulation by Yoon Suk Yeol and Kim Geon-hee' with unanimous support from 173 lawmakers present. Members of the People Power Party and the Reform Party abstained from the vote. A filibuster initiated immediately after the bill was introduced ended after 24 hours, following agreement from lawmakers of the Democratic Party and other ruling coalition members. The amendment extends the investigation period of the second special prosecutor by 30 days and increases the cap on dispatched personnel from 130 to 150. It also includes provisions to investigate acts that obstruct audits by public officials and allows for the designation of up to 10 special prosecutors with at least five years of legal experience as prosecutors for maintaining public prosecution. The People Power Party opposed the bill's introduction by the Democratic Party, responding with a filibuster. Floor leader Jeong Jeom-sik stated during a meeting that the special prosecutor had demanded the attendance of opposition politicians just before the end of the investigation period, claiming that the extension was a blatant lobbying effort by the ruling party, revealing the essence of the special prosecutor as a means of suppressing the opposition. He further criticized the special prosecutor's extension as merely a continuation of the three major special prosecutors, stating that it was a waste of national investigative resources, ultimately passing the burden onto the public. Starting from the previous day, lawmakers including Yoon Sang-hyun, Kwak Gyu-taek, Lee Jin-sook, Kim Tae-kyu, and Yoon Yong-geun participated in the filibuster. However, the filibuster was forcibly concluded after 24 hours due to the ruling coalition's agreement to end the debate.* This article has been translated by AI. 2026-07-21 16:04:00
  • Houthi Rebels Target Saudi Oil Routes Amid Rising Tensions in the Red Sea
    Houthi Rebels Target Saudi Oil Routes Amid Rising Tensions in the Red Sea As tensions between the U.S. and Iran escalate, shipping traffic through the Strait of Hormuz has plummeted, causing instability in maritime logistics that has now spread to the Red Sea. The Iran-aligned Houthi rebels in Yemen have declared a maritime blockade against Saudi Arabia, which has redirected its oil exports to avoid the Strait.According to shipping analytics firm Kpler, only four vessels carrying commodities passed through the Strait of Hormuz on July 20, a decrease from seven the previous day. No Very Large Crude Carriers (VLCCs) or liquefied natural gas (LNG) carriers were reported.Attacks on vessels have continued, with reports on July 21 indicating that a tanker was struck by a projectile near the Strait of Hormuz, prompting crew members to abandon ship. Two other tankers were attacked the previous day in the same vicinity.With oil transport through Hormuz disrupted, Saudi Arabia has significantly increased its reliance on the Red Sea. An analysis by Reuters of data from Kpler and Signal Ocean revealed that over 70% of Saudi oil exports are now being routed to the Red Sea port of Yanbu.Shipments from Yanbu have surged to an average of about 4 million barrels per day, more than quadrupling from 973,000 barrels per day a year ago. The volume of oil passing through the Bab el-Mandeb Strait also rose to 7.4 million barrels per day last month, up from 4.2 million barrels a year earlier.However, the Red Sea route, which was seen as a safer alternative, is now facing new threats. The Houthis announced their intention to impose a maritime blockade, citing Saudi attacks on the international airport in Sana'a and the blockade of ports under their control.While the specifics of the blockade have not been disclosed, concerns are growing that the Houthis may target Saudi vessels in this critical maritime corridor, leading to a rapid increase in shipping risk costs.According to Reuters, the war risk insurance premiums for vessels transiting the Red Sea have jumped from about 0.3% to 0.75% of the vessel's value since the Houthi blockade announcement. If passage through Bab el-Mandeb is restricted, Saudi oil bound for Asia would need to navigate around the southern tip of Africa, significantly increasing transport times and costs.In the past, attacks by the Houthis on commercial vessels led to significant disruptions in global logistics. The International Monetary Fund (IMF) reported that trade volumes through the Suez Canal fell by 50% in the first two months of 2024 compared to the same period the previous year.The United Nations Conference on Trade and Development (UNCTAD) noted that as vessels began to reroute around the Cape of Good Hope, container shipping rates from Shanghai surged by an average of 122% and by 256% for shipments to Europe between early December 2023 and early February 2024.Now, with operations in the Strait of Hormuz severely curtailed, there are concerns that disruptions could extend to Bab el-Mandeb, further straining oil and logistics transport.Notably, the primary destinations for oil and petroleum products departing from Yanbu include South Korea, Japan, China, Singapore, and India, meaning that Asia's energy supply chain could be directly impacted. The volume of oil passing through Bab el-Mandeb last month accounted for about 7% of global oil production.In response, Saudi Arabia has taken action. The Saudi-led Arab coalition stated that it is implementing measures to protect commercial vessels transiting Bab el-Mandeb and will respond swiftly and decisively if the Houthis attack ships.Meanwhile, U.S. forces have been conducting airstrikes against Iran for ten consecutive days, aiming to weaken Iran's ability to attack commercial vessels. President Donald Trump recently warned that Iran would face severe consequences for each U.S. military casualty.Amid escalating hostilities, efforts for a ceasefire continue. Mediators have proposed a ten-day truce to revive a temporary agreement reached last month between the U.S. and Iran, although both sides have yet to accept the proposal.* This article has been translated by AI. 2026-07-21 16:00:00
  • Bukwang Pharmaceutical Reports First Half Revenue Exceeding 100 Billion Won
    Bukwang Pharmaceutical Reports First Half Revenue Exceeding 100 Billion Won Bukwang Pharmaceutical has reported that its revenue for the first half of the year has surpassed 100 billion won for the first time in the company's history. While revenue grew by double digits, profitability significantly declined due to rising costs.On July 21, Bukwang announced that it recorded 104.8 billion won in revenue and 2.5 billion won in operating profit for the first half of the year. This represents a 15.9% increase in revenue compared to the same period last year, while operating profit fell by 49.9%.The revenue growth was attributed to improved performance from Bukwang Medica and growth in key products. However, the decline in operating profit was due to increased cost burdens from rising exchange rates, higher outsourcing costs related to the establishment of automated production lines, and temporary increases in initial marketing expenses for new product launches.Prescription drugs also continued to show growth. The prescription amounts for the diabetic neuropathy treatments 'Dexide' and 'Chioctaside' increased by 7% compared to the same period last year.The central nervous system (CNS) product line also experienced growth. The prescription amounts for strategic products such as the schizophrenia and bipolar disorder treatment 'Latuda', the insomnia treatment 'Zaleplon', and the epilepsy treatment 'Orphir' increased by 32% compared to the first half of last year.During an investor relations event, the company disclosed its R&D status. Bukwang received approval for an Investigational New Drug (IND) application for a Phase 3 clinical trial to expand the indications for 'Latuda' as an adjunctive treatment for major depressive disorder (MDD). The company plans to use this to broaden the prescription range of 'Latuda' and enhance its product competitiveness.Subsidiary Contera Pharma has applied for an IND for a global Phase 2 clinical trial of 'CP-012', a treatment for morning akinesia in Parkinson's disease. This trial will involve 80 adult Parkinson's patients experiencing morning off symptoms, and will be conducted at 25 specialized medical institutions in the United States, Poland, Italy, and Spain. The company aims to secure key top-line data in the first quarter of 2028 and complete the final clinical trial report in the first half of that year.Meanwhile, Bukwang is pursuing a strategic integration with Korea Union Pharmaceutical and has restructured its board. Seong Kwang-hyun has been appointed as the CEO of Korea Union Pharmaceutical, while Kim Seong-soo has been named the Vice President of Korea Union Pharmaceutical.Seong Kwang-hyun, an in-house director, is a human resources and organizational management expert who previously served as the Executive Director of OCI HR/GA and the Executive Director of OCI Holdings' HR department. He has been leading the integration efforts as the Vice President of the Union Pharmaceutical Acquisition Planning Task Force (TF) at Bukwang.Kim Seong-soo, also an in-house director, is a financial and management consulting expert who has served as a partner at Samil PwC, EY Hanyoung, and Samjeong KPMG. Since 2024, he has been the Vice President overseeing Bukwang's business operations, leading the company's turnaround efforts.* This article has been translated by AI. 2026-07-21 16:00:00
  • Kyobo Life Expands Integrated App Services to Include Health Checkup Reservations
    Kyobo Life Expands Integrated App Services to Include Health Checkup Reservations Kyobo Life has launched a health checkup reservation service, enhancing its competitiveness as a health management platform beyond insurance.The company announced on July 21 that the new service simplifies the process of booking health checkups through its integrated app. Customers holding Kyobo Life's insurance, loans, or retirement pension products can easily compare various health checkup items and prices from multiple centers.Additionally, in partnership with the health checkup platform 'Good Doctor,' users can reserve discounted health checkup packages at over 180 major centers nationwide.Since launching the integrated app in September 2022, Kyobo Life has been offering a range of financial services, including insurance, retirement pensions, loans, and trusts, all within a single app. The company is also continuously expanding lifestyle services such as library services, health and mental management, coverage analysis, asset discovery, and supplement recommendations.Thanks to these enhancements, the monthly active users (MAU) of the Kyobo Life integrated app surpassed 710,000 as of June, making it the second most used app in the life insurance sector according to Mobile Index. The number of registered users has also been steadily increasing, nearing 3.2 million last month, marking the highest level since its launch.A Kyobo Life representative stated, "Helping customers manage their health before they get sick is also part of our commitment to customer protection. We will continue to expand differentiated services to develop a platform that accompanies customers throughout the entire process from insurance enrollment to maintenance and claims."* This article has been translated by AI. 2026-07-21 15:56:00
  • Saemaul Geumgo Distributes Samgyetang to Support Vulnerable Seniors
    Saemaul Geumgo Distributes Samgyetang to Support Vulnerable Seniors Saemaul Geumgo Central Association conducted a volunteer activity to distribute samgyetang, a traditional Korean chicken soup, to local seniors and vulnerable groups suffering from the summer heat.On July 21, Saemaul Geumgo announced that the 'Healthy Samgyetang Distribution' event took place at the Gwanak Senior Comprehensive Welfare Center in Seoul.This initiative was organized to support the health of local seniors and vulnerable populations during the summer. About 20 members of the 'MG Dasum Volunteer Group,' which was launched in May, participated in the event.The volunteers prepared the samgyetang alongside staff from the Gwanak Senior Comprehensive Welfare Center and personally delivered it to the seniors while checking on their health and well-being.In addition to this activity, Saemaul Geumgo is continuing its summer social contribution efforts through projects like the 'Our Neighborhood MG Disaster Prevention Welfare Facility Project' and the operation of 'Cool Rest Areas' during the hot season.A representative from Saemaul Geumgo expressed hope that the carefully prepared samgyetang would help restore the energy of seniors fatigued by the heat, stating, "We will continue to practice sharing with the community and uphold the value of coexistence."* This article has been translated by AI. 2026-07-21 15:56:00
  • National Discussion on Real Estate Highlights Tax, Loan, and Supply Issues, Overlooking Rent Stability
    National Discussion on Real Estate Highlights Tax, Loan, and Supply Issues, Overlooking Rent Stability As the national discussion on real estate approaches, tax, loan, and supply regulations have taken center stage, while measures for stabilizing rental costs for tenants have been relatively overlooked. There are growing calls for rental stability solutions to be included in the national discussion led by President Lee Jae-myung on July 23, especially since the rental system itself has not been highlighted as a separate issue in previous discussions.According to the real estate industry on July 21, the government plans to comprehensively discuss key opinions in the areas of housing supply, housing finance, and real estate taxation during the national discussion on real estate hosted by President Lee Jae-myung on July 23. Prior to this, sector-specific discussions were held by the Ministry of Land, Infrastructure and Transport, the Financial Services Commission, and the Ministry of Economy and Finance from July 14 to 16.While the issue of rental markets was included in the supply sector discussions, the focus was primarily on the entities supplying rental housing and the proportions of public rental and public sale housing. The rental system itself, including rental prices, contract renewals, and security deposit return safeguards, was not addressed as a distinct issue.The concern is that the outcomes of discussions on taxation, finance, and supply will all impact the rental market. An increase in property taxes raises fears of rental price hikes, while restrictions on jeonse loans increase the burden on tenants to secure deposits, potentially pressuring them to switch to monthly rent or half-monthly rent. As redevelopment projects begin, demand for jeonse in surrounding areas is also expected to rise. This creates a structure where the ultimate burden of policy changes may fall on the rental market.The rental market in Seoul is already showing signs of instability. As of June, the number of jeonse listings for apartments in Seoul was 18,574, a 27.26% decrease from 25,535 during the same period last year. The proportion of renewal contracts in Seoul was also recorded at 55.4% last month, indicating a trend where existing tenants are remaining in place as new jeonse listings decline.The shift towards monthly rent is also becoming more pronounced. From January to May this year, the proportion of monthly rent transactions among rental agreements was 68.6%, an increase of 7.6 percentage points compared to the previous year. The pressures from jeonse deposit burdens, concerns over deposit returns, and jeonse loan burdens are contributing to the increased pressure to switch to monthly rent or half-monthly rent.Price increases continue as well. According to the Korea Real Estate Agency, as of the second week of July, the sale price of apartments in Seoul rose by 0.30%, while jeonse prices increased by 0.28%. The cumulative increase in apartment prices in Seoul this year stands at 5.74% for sales and 5.72% for jeonse, with the gap narrowing to just 0.02 percentage points. Compared to the same period last year, the pressure on jeonse prices has significantly increased.Kwon Dae-jung, a professor of economics and real estate at Hansung University, stated, “As the number of jeonse listings decreases and jeonse prices surge, the burden of housing costs on tenants is growing, leading them to shift to the sales market. This cycle is repeating amid concerns over future supply shortages and a spreading 'pre-purchase' mentality.”There is also insufficient supply of non-apartment jeonse options to replace apartment jeonse. Due to the impact of jeonse fraud, there is a strong preference for monthly rent in the villa, multi-family, and urban-type housing markets, and the supply of newly built non-apartment units is also constrained. It has been suggested that the rationalization of financial and tax regulations for jeonse loan systems and the supply of non-apartment new builds should be considered together to stabilize the rental market.A real estate industry insider remarked, “In a situation where jeonse listings are decreasing and the proportion of monthly rent is increasing, discussing taxes and loans separately could overlook the burden on tenants. We need to discuss property taxes, jeonse loans, and relocation costs from redevelopment projects together to establish rental stability measures.”* This article has been translated by AI. 2026-07-21 15:52:00
  • KOSPI Recovers to 6,740 Amid Semiconductor Surge
    KOSPI Recovers to 6,740 Amid Semiconductor Surge The KOSPI surged over 3%, recovering to the 6,740 level, driven by strong foreign and institutional buying. The rise was fueled by robust semiconductor exports in July and expectations of mediation between the U.S. and Iran, with major semiconductor stocks like Samsung Electronics and SK Hynix leading the index's increase. The KOSDAQ also rebounded from an early decline of over 2% to close slightly higher. On July 21, the KOSPI finished at 6,747.95, up 231.68 points (3.56%) from the previous trading day. In the securities market, institutions purchased a net 1.39 trillion won, while foreign investors bought a net 295 billion won, contributing to the index's rise. In contrast, individual investors sold a net 1.66 trillion won. The KOSPI initially fell below 6,500 due to geopolitical uncertainties between the U.S. and Iran but quickly reversed course. The index's gains prompted a temporary trading halt due to increased buying activity. Major stocks generally showed strong performance. Samsung Electronics closed at 259,000 won, up 6.15%, while SK Hynix rose 4.08% to 1,836,000 won. Other notable gainers included SK Square (up 6.46%), Samsung SDI (up 2.75%), and Samsung Biologics, which rose 3.72%. Hyundai Motor ended the day flat. The KOSDAQ index closed at 753.34, up 3.70 points (0.49%). After an early drop of over 2%, it recovered and turned positive in the afternoon. In the KOSDAQ market, individual investors bought a net 144.9 billion won, while foreign and institutional investors sold a net 134.3 billion won and 14.4 billion won, respectively. Most large-cap stocks in the KOSDAQ also saw gains. Alteogen rose 1.30% to 273,000 won, and EcoProBM increased 1.73% to 105,900 won. EcoPro climbed 2.31% to 75,200 won, while Rainbow Robotics surged 9.73% to 411,500 won. However, Peptron and HLB fell by 0.47% and 0.49%, respectively. The stock market's rebound was influenced by strong semiconductor export figures. South Korea's exports from July 1 to 20 reached $54.9 billion, a 52.3% increase compared to the same period last year. Notably, semiconductor exports surged 180.6% to $22.1 billion, driving the overall export growth. This solid export performance is seen as boosting expectations for the semiconductor sector's earnings and restoring investor sentiment. Easing concerns over escalation between the U.S. and Iran also encouraged a preference for riskier assets. Although military tensions persist, mediation proposals from countries like Pakistan and Qatar have somewhat alleviated fears of further escalation. Lee Kyung-min, a researcher at Daishin Securities, stated, "The domestic market saw an influx of bargain buying centered on the semiconductor sector, while mediation efforts by Pakistan and Qatar have strengthened the preference for risk assets. The strong semiconductor export figures also supported earnings momentum, contributing to upward pressure on stock prices." He added, "In the U.S. market, there was a rebound in semiconductor stocks that had recently declined, and positive investment opinions from global investment banks regarding the memory sector also supported investor sentiment. The net buying by foreign and institutional investors helped spread the bullish trend across the sector."* This article has been translated by AI. 2026-07-21 15:52:00
  • Education Minister Choi Kyo-jin Advocates for Maintaining National Tax Linkage
    Education Minister Choi Kyo-jin Advocates for Maintaining National Tax Linkage As tensions rise between government departments and within the education sector over the reform of local education finance grants, Education Minister Choi Kyo-jin has stepped forward to address the issue. He proposed that the current national tax linkage system be maintained to ensure stability in primary and secondary education, while excess funds resulting from a declining school-age population should be redirected to a newly established 'Future Response Fund' for investment in higher education and other areas. This approach is seen as a strategy to protect the education budget from the Ministry of Economy and Finance's push for significant cuts. On July 21, Minister Choi shared his views on his social media account, stating, "The future of education can only be secured through stable investment and responsible reform," outlining the Ministry of Education's official stance on the contentious local education finance grant reform. The key points of Minister Choi's proposed reform can be summarized in three main areas. First is the 'absolute maintenance of the national tax linkage system.' He emphasized, "For decades, this system has been a crucial foundation of our education, protecting students' rights regardless of economic fluctuations," asserting that education should not be swayed by short-term economic conditions. This clearly opposes the Ministry of Economy and Finance's recent call for the complete abolition of the national tax linkage system (20.79%) and a shift to a method based on economic growth rates. Second is the acceptance of the reality of 'excess tax revenue' due to the declining school-age population and economic prosperity. Minister Choi acknowledged, "We cannot ignore the new reality of excess tax revenue resulting from a declining school-age population and economic growth," stating that while the national tax linkage system will be maintained, they are considering transferring funds exceeding a certain level to the upcoming Future Response Fund, reflecting the demographic changes. This recognition indicates an understanding of the serious implications of changing population structures, rather than a blanket defense of education grants. However, Minister Choi stipulated that the Future Response Fund must include an 'education account' to ensure that funds secured from excess tax revenue do not flow into general budgets for other sectors. He stressed that these funds should be legally guaranteed for use in education areas that will determine South Korea's future competitiveness, such as early childhood education, higher education, lifelong learning, and artificial intelligence education. This proposal is seen as a defensive measure against the financial authorities' attempts to reduce the education budget while also addressing the severe financial difficulties faced by higher education institutions and the integration of early childhood education funding. The Ministry of Education views this as a balanced alternative that maintains stability in primary and secondary education while allowing the entire national education system to grow together. Minister Choi also called for significant reforms within local education offices and schools. Acknowledging external criticisms that education offices are overfunded, he urged the education sector to engage in self-reflection. He stated, "We must reduce unnecessary or traditional expenditures and be bolder in investing in the future of students and education," emphasizing that as taxpayers' money, education finances must be managed more transparently and responsibly.* This article has been translated by AI. 2026-07-21 15:52:00
  • New Proposal Suggests Additional Fees on Home Loans to Manage Household Debt
    New Proposal Suggests Additional Fees on Home Loans to Manage Household Debt A new proposal suggests imposing a fee based on a percentage of the loan amount in addition to interest when obtaining a mortgage. This approach aims to curb demand by increasing borrowing costs rather than directly reducing loan limits. Critics argue that this could further burden genuine borrowers amid rising interest rates and stricter lending criteria.According to the financial sector, the Financial Services Commission introduced the concept of a 'macroprudential management fee' during a real estate finance policy discussion held on July 15.The macroprudential management fee would require borrowers to pay a percentage of the loan amount as a fee in addition to the mortgage interest. For example, a fee of 1% would apply to loans for homes priced between 500 million and 1.5 billion won, while a 2% fee would be imposed on loans for homes exceeding 1.5 billion won. This method seeks to discourage loan demand by increasing borrowing costs rather than implementing quantitative restrictions on loan limits.Similar to the foreign exchange stability fee introduced to curb excessive short-term foreign currency borrowing by banks, this fee would serve a specific policy purpose.Kim Young-do, a senior researcher at the Korea Financial Research Institute, who proposed the idea, stated, "The specifics of the system could vary, but the basic idea is to require an additional fee beyond interest payments. This could be paid monthly or in a lump sum at the time of loan execution."A similar concept was suggested in a report published by the Capital Market Research Institute in July of last year. Senior researcher Kang Hyun-joo argued that existing regulations focused on total volume and the debt service ratio (DSR) alone are insufficient to stabilize household debt, emphasizing the need for price-based regulations that impose the social costs of excessive borrowing on borrowers.The discussion of such measures arises as household loan demand remains resilient despite stringent regulations from financial authorities and self-management by banks. The argument is that merely reducing loan limits has its limitations, necessitating new regulations that increase borrowing costs.However, there are concerns in the market that if implemented, the new system could excessively burden borrowers. With interest rates already rising due to increases in the base rate and adjustments in bank margins, adding a fee of this nature could further strain borrowers.Under the proposed system, a borrower taking out a loan of 600 million won to purchase a home priced over 1.5 billion won would need to pay an additional fee of 12 million won, which is 2% of the loan amount. This means they would have to secure additional funds on top of the monthly loan interest and principal repayments.Particularly concerning is the potential impact on first-time homebuyers or those purchasing homes for personal use, as imposing the same fee on them could create a one-size-fits-all regulation that fails to distinguish between speculative and genuine demand. If fees are based solely on home prices and loan amounts, factors such as income, assets, and actual residency may not be considered.Nonetheless, financial authorities clarified that they are not currently considering the implementation of this system. A Financial Services Commission official stated, "We view this as one of several ideas presented at the discussion and are not at a stage to publicize or review it for policy implementation." 2026-07-21 15:52:00
  • Seoul assures oil supplies enough, but Houthi risk clouds Q4
    Seoul assures oil supplies enough, but Houthi risk clouds Q4 SEOUL, July 21 (AJP) - Just as Asian economies had adapted to the disruption of the Strait of Hormuz by relying increasingly on Saudi Arabia's Red Sea exports, Yemen's Houthi militants are threatening the Bab el-Mandeb Strait, putting the region's alternative oil lifeline at risk and raising the prospect that the Middle East's two principal oil export corridors could be disrupted simultaneously. The new threat leaves major Asian importers, including South Korea, facing renewed uncertainty after months of longer shipping routes and higher freight costs triggered by the U.S.-Iran conflict. About 70 percent of Saudi crude and petroleum products shipped from the Red Sea export terminal at Yanbu have been destined for Asia since April after Riyadh diverted exports away from the Strait of Hormuz. Any prolonged disruption at Bab el-Mandeb would force tankers to make the far longer journey around Africa's Cape of Good Hope, delaying deliveries and driving up freight costs. South Korea is particularly exposed. Saudi Arabia supplied more than 35 percent of the country's crude imports last year, according to the Korea Petroleum Association. "Saudi Arabia has so far been able to maintain supplies by shipping crude through the Red Sea rather than through the Strait of Hormuz," a Korea Petroleum Association official said. "But if the Bab el-Mandeb is disrupted as well, the available alternatives become much more limited." While Saudi cargoes could theoretically move north through the Suez Canal, the route is ill-suited for the very large crude carriers (VLCCs) that dominate shipments to Asia. The government, however, sought to calm immediate supply concerns. South Korea has enough crude oil supplies to last through September and expects no immediate disruption even if shipping through the Red Sea is halted, the Ministry of Trade, Industry and Resources said Tuesday, as lingering tensions in the Middle East put another major energy shipping route at risk. Refiners have already secured crude for July and August equivalent to more than 110 percent of last year's average import volume, while bookings for September have surpassed 90 percent of imports recorded during the same period a year earlier, according to the ministry. "We have confirmed that there should be no major problem with crude oil supplies through September," said Yang Ki-wook, a senior ministry official. "Even if the Red Sea is blocked, we do not expect any particular difficulty." South Korea appears insulated through September, but the outlook beyond that is less certain. A tanker typically takes about 20 to 23 days to sail from the Gulf to East Asia. Rerouting around Africa's Cape of Good Hope would add another two to three weeks, raising the risk of supply disruptions during the fourth quarter should the conflict persist. Most Middle Eastern crude bound for South Korea is transported aboard VLCCs capable of carrying more than 2 million barrels. When fully loaded, many draw too much water to pass safely through the Suez Canal, requiring cargoes to be transferred to smaller vessels or rerouted through alternative facilities. "Smaller tankers could still use the route, but there are obvious limits to how much they can carry," the Korea Petroleum Association official said. "It's like replacing a large cup with a tiny syrup cup. It may work in an emergency, but moving large volumes that way would be extremely difficult." The Bab el-Mandeb sits at the southern entrance to the Red Sea, linking it to the Gulf of Aden, the Arabian Sea and the Indian Ocean. For tankers leaving Yanbu, it has become the only practical route to Asian customers after shipping through the Strait of Hormuz became severely constrained. Before the U.S.-Iran conflict erupted in late February, Saudi Arabia exported about 7.2 million barrels of crude a day, with nearly 90 percent passing through Hormuz, according to shipping data provider Kpler. The disruption forced Saudi Aramco to shift exports to its East-West Pipeline, which transports crude from eastern oil fields to Yanbu on the Red Sea. Since then, more than 70 percent of Saudi Arabia's normal crude exports have been redirected through Yanbu. Shipments from the port have averaged roughly 4 million barrels a day in recent weeks, more than four times the level recorded during the same period last year. While cargoes bound for Europe continue north through the Suez Canal, exports to Asia must pass south through Bab el-Mandeb, transforming the narrow waterway into Saudi Arabia's critical export gateway to its largest customers. The shift is evident in shipping flows. According to the U.S. Energy Information Administration, an average 5.4 million barrels per day of crude oil and petroleum products transited the Bab el-Mandeb in the first quarter. By June, total petroleum flows through the strait had climbed to 7.4 million barrels a day, equivalent to about 7 percent of global oil production, according to Kpler, up from 4.2 million barrels a day a year earlier. Should the strait become impassable, tankers would have little choice but to sail around Africa, adding thousands of nautical miles and roughly two to three weeks to voyages to Asia. "The impact is going to be massive in the first month," said Matt Smith, commodity research director at Kpler. "The biggest impact is going to be on Saudi flows." Alternative routes offer only limited relief. Besides draft restrictions in the Suez Canal, Egypt's SUMED Pipeline lacks sufficient capacity to absorb the diverted volumes. Brent crude settled $1.12, or 1.3 percent, higher at $89.22 a barrel Monday after touching an intraday high of $91.42, with hopes of renewed negotiations between Washington and Tehran helping temper gains. Analysts warned crude prices could climb to between $115 and $120 a barrel if Houthi attacks were to halt traffic through Bab el-Mandeb for a prolonged period. The latest threat marks another escalation after the collapse of the June ceasefire between Washington and Tehran. Iran has continued to interfere with shipping through the Strait of Hormuz despite U.S. assurances that neutral vessels bound for non-Iranian destinations would not be impeded. 2026-07-21 15:48:41