According to the Korea National Oil Corp.’s Opinet price information system, the nationwide average gasoline price stood at 1,883.79 won per liter as of 9 a.m. Friday, down about 15 won from a day earlier.
Diesel averaged 1,911.1 won per liter, down about 21 won. Diesel remained more expensive than gasoline.
Prices in Seoul also declined. Gasoline in the capital averaged 1,906.40 won per liter, down about 21 won, while diesel fell about 30 won to 1,905.53 won.
The government began enforcing the cap at midnight Friday, setting maximum refinery supply prices per liter at 1,724 won for regular gasoline, 1,713 won for automotive diesel and 1,320 won for kerosene. Premium gasoline, which has a limited customer base, was excluded. The government said it will reset the caps every two weeks after reviewing the Middle East war and oil price trends.
To guard against potential supply tightening after the cap, the government said it will also issue a notice banning hoarding. It plans to strengthen monitoring of prices at gas stations nationwide and intensify inspections for market-disrupting practices.
It also said it has prepared a post-settlement system to compensate refiners for losses caused by the cap. If refiners incur losses, the government plans to reimburse them quarterly through a “maximum price settlement committee” made up of oil experts, including accounting, legal and academic specialists.
Under the plan, an accounting firm will verify loss estimates calculated by each refiner, and the committee will make the final determination. The government noted that when prices are falling, refiners could also see gains because of the cap, and said it will closely calculate profits and losses in the post-settlement process.
The government again stressed that the cap is intended to stabilize the market rather than impose artificial price controls. Still, controversy has grown after one refiner announced it would apply a post-settlement method for gas stations by splitting the period into before and after March 13, instead of using a monthly average.
The gas station industry says stations will be forced to sell inventory bought at higher pre-cap prices without being able to charge more than the now-public supply price, leaving them to absorb losses.
Meanwhile, international oil prices climbed back above $100 a barrel after Ayatollah Seyyed Mojtaba Khamenei declared a hard-line response toward the United States and Israel, including a possible closure of the Strait of Hormuz. As of Thursday (local time), ICE Futures Europe’s May Brent crude contract settled at $100.46 a barrel, up 9.2% from the previous session.
On the New York Mercantile Exchange, the April WTI contract settled at $95.73 a barrel, up 9.7%. Analysts have warned that if the Middle East war drags on and high oil prices persist, the impact of the price cap could be reduced.
On the New York Mercantile Exchange, the April WTI contract settled at $95.73 a barrel, up 9.7%. Analysts have warned that if the Middle East war drags on and high oil prices persist, the impact of the price cap could be reduced.
* This article has been translated by AI.
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