Government Launches Special Inspections Amid Concerns Over Illegal Oil Distribution

An SK gas station in downtown Seoul. [Photo=Yonhap News]

The South Korean government is launching special inspections to address concerns over illegal oil distribution and market disruptions following a reduction in maximum oil product prices. The move aims to ensure that price cuts from refiners are reflected in consumer prices, alleviating inflationary pressures.
The Ministry of Trade, Industry and Energy announced that from July 1 to July 14, it will conduct inspections targeting illegal oil distribution and market disturbances.
On June 27, the ministry lowered the maximum price of oil products for the seventh time, reducing it by 150 won per liter compared to the sixth adjustment. As a result, the supply prices from refiners are now set at 1,784 won per liter for gasoline, 1,773 won for diesel, and 1,380 won for kerosene.
This is the first time the government has lowered the maximum price, reflecting international oil prices and domestic supply conditions to ensure consumers feel the stabilizing effects of oil prices. However, if the reductions are not timely reflected in gas station prices, the effectiveness of the policy will be limited.
The government plans to proactively address illegal oil distribution, including counterfeit oil, which may exploit the current market confusion. Although the supply price has decreased by 150 won per liter, delays in passing on these reductions could exacerbate the burden on consumers. Inspections will be conducted through a joint task force involving multiple government agencies.
The inspections will focus on approximately 1,000 high-risk gas stations identified through big data analysis. The aim is to prevent illegal activities that hinder the effective transmission of price reductions to consumers. Additionally, the Oil Call Center, which has operated as a reporting center for illegal oil distribution, will continue its operations.
With the government concentrating inspections on high-risk gas stations over the next two weeks, pressure on the market regarding both illegal oil distribution and delays in price reductions is expected to increase. Minister of Trade, Industry and Energy Kim Jeong-kwan stated, "Considering that this is the first downward adjustment in the maximum price system after seven rounds, illegal activities that deceive consumers cannot be tolerated. We will strive to ensure that consumers can feel the stability of the oil market."

* This article has been translated by AI.