The government has decided to freeze the maximum price for oil products for the ninth time. Despite rising international oil prices, which have climbed back to around $90 per barrel due to increased uncertainty from the Middle East conflict, the decision was made with consideration for the economic burden on citizens from extreme heat and heavy rainfall.
The Ministry of Trade, Industry and Energy announced on August 21 that starting at midnight on August 22, the maximum prices for oil products will remain unchanged from the previous eighth price level: 1,784 won per liter for regular gasoline, 1,773 won for diesel, and 1,380 won for kerosene. These maximum prices will apply to the oil products supplied by refiners to gas stations over the next four weeks.
The government has been implementing the maximum price system for oil products since March 13. The initial maximum prices were set at 1,724 won per liter for regular gasoline, 1,713 won for diesel, and 1,320 won for kerosene. The second maximum price, which took effect on March 27, was set at 1,934 won for gasoline, 1,923 won for diesel, and 1,530 won for kerosene, and prices remained frozen up to the sixth maximum price.
On June 26, the government announced the seventh maximum price, reducing the supply prices for gasoline, diesel, and kerosene by 150 won each. The eighth and ninth maximum prices have since been frozen at the same level as the seventh.
The decision to freeze prices was made after comprehensive consideration of the situation in the Middle East, trends in international oil prices, domestic inflation, and the burden on citizens. Following the expiration of a 60-day memorandum of understanding (MOU) between the United States and Iran in June, tensions between the two countries have continued, increasing uncertainty in the Middle East.
As a result, international oil prices, which had dropped to around $70 per barrel in early August due to hopes for peace, have begun to rise again. Brent crude prices increased from an average of $81.7 in the first week of August to $88.2 in the second week, reaching $93.8 on August 20.
During the same period, Dubai crude rose from $79.8 to $95.6, while West Texas Intermediate (WTI) increased from $77.4 to $87.8. International gasoline prices also rose to $114 per barrel, and diesel prices reached $164.
However, the current prices of international crude oil and oil products are not significantly different from those at the time the eighth maximum price was set, and the recent extreme weather conditions have increased the burden on citizens, influencing the decision to freeze prices.
Domestic gas station prices have also remained stable. Since the implementation of the seventh maximum price on June 27, domestic fuel prices have steadily declined, with the national average for gasoline at 1,862 won per liter and diesel at 1,845 won as of August 20.
There are currently no significant issues with short-term oil supply. The Ministry of Trade, Industry and Energy has confirmed that it has secured oil and naphtha import volumes at 100% of last year's average for August. Although international oil prices are rising, there is no immediate need to adjust the maximum prices due to supply shortages.
The ministry stated, "As the situation in the Middle East is constantly changing, the government will monitor domestic and international conditions in real-time and will operate the maximum price system flexibly and promptly, considering the Middle East situation, oil supply and demand, inflation, and the need for demand management."
* This article has been translated by AI.
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