Four major South Korean oil companies faced criticism during a National Assembly audit on allegations of price fixing and unfair trading practices. The executives expressed regret over the burden on citizens due to rising oil prices and promised to improve gas station transaction practices.
On October 12, executives from SK Energy, HD Hyundai Oilbank, GS Caltex, and S-Oil appeared as witnesses before the National Assembly's Political Affairs Committee. Initially scheduled to attend, GS Caltex Vice Chairman Heo Se-hong and S-Oil CEO Anwar Al-Hizaji were replaced by their respective vice presidents.
Democratic Party lawmaker Min Byeong-deok pointed out that conversations within the oil companies included remarks like, "This is a company that thrives on war," and "We expect to earn 2 trillion won this year," suggesting that the companies were exploiting the situation for profit.
Min also criticized the transaction structure between oil companies and gas stations, noting that full purchase contracts make it difficult for gas stations to choose cheaper suppliers, and the post-settlement system prevents them from knowing the exact supply prices when selling products.
In response, SK Energy CEO Kim Jong-hwa stated, "We will do our best to identify and improve the issues related to full purchase contracts."
HD Hyundai Oilbank CEO Song Myung-jun expressed regret over the burden felt by citizens during periods of soaring oil prices.
S-Oil Vice President Lee Geon-myeong also apologized, acknowledging the significant burden on citizens following the Hormuz crisis.
GS Caltex Vice President Kim Chang-soo stated, "We are in the process of making necessary improvements as announced by the Fair Trade Commission and will implement them promptly."
People Power Party lawmaker Park Seong-hoon asked Kim Jong-hwa about the basis for calculating compensation for losses due to the implementation of the maximum oil price system, questioning whether expected profits that would have been gained without the price cap were included in the compensation calculations.
Kim responded, "We have submitted materials related to the maximum price system settlement and are currently discussing the details," but refrained from commenting on the amount of compensation requested and its basis.
In response, Fair Trade Commission Chairman Joo Byeong-ki indicated a willingness to collaborate with the Ministry of Trade, Industry and Energy to utilize the price data and investigation results secured by the Commission for verifying compensation losses.
He also stated that if collusion is ultimately confirmed, they would re-examine whether price distortions were reflected in the compensation amounts and request refunds for any identified overpayments.
The issue of self-service gas stations' pricing methods was also raised. Lawmaker Park Jun-tae pointed out that consumers are not adequately informed that they can pay only for the amount dispensed when selecting "full tank" at self-service stations, even if the pump stops automatically.
In response, Kim Jong-hwa announced that they would distribute informational stickers starting with company-owned gas stations and would work on system improvements by the end of the year. He also mentioned plans to support the expansion of these improvements to independently operated gas stations.
HD Hyundai Oilbank stated they would review improvement measures, while S-Oil committed to quickly implementing a stop button for refueling in consultation with related companies.
GS Caltex Vice President Kim Chang-soo reported that they had improved the systems at 100% of their company-owned self-service gas stations from October 10 to the morning of the hearing, and they plan to make similar enhancements at independently operated stations soon.
Lawmaker Park Jun-tae also pressed for clarity on the involvement of management in the price-fixing allegations. He referenced ongoing investigations by the prosecution into team leaders at SK Energy and HD Hyundai Oilbank for allegedly exchanging price information and colluding, questioning whether management was aware of these actions beforehand.
In response, Kim stated that they would clarify the matter through the ongoing Fair Trade Commission review process. Song also expressed regret over the investigation into collusion and committed to cooperating fully with the related procedures. However, both companies did not provide clear answers regarding management's prior knowledge of the situation.
* This article has been translated by AI.
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