MOTIE Estimates Refinery Losses at KRW 1.5 Trillion per KRW 100 Oil Price Gap

The Ministry of Trade, Industry and Energy (MOTIE) estimated that refineries will incur losses of KRW 1.5 trillion for every KRW 100 gap in oil prices due to the petroleum price ceiling system.

This calculation is based on a premise that the gap between the estimated price without the price ceiling and the maximum set by the government would not exceed KRW 200.

The MOTIE allocated KRW 4.2 trillion in targeted contingency reserves to compensate refineries for losses incurred from March 13, when the petroleum price ceiling system was implemented.

This allocation includes an additional KRW 1.5 trillion, which was added in response to concerns about crude oil prices soaring to USD 150.