South Korea is discussing resuming imports of Russian oil and gasoline as escalating tensions in the Middle East threaten energy supplies.
South Korea Weighs Russian Energy Re-Import
The South Korean government is in talks with companies regarding the potential resumption of Russian crude oil and gasoline imports, Reuters reported Thursday. Authorities aim to secure energy supplies amid the escalating conflict in the Middle East.
Seoul’s Ministry of Industry stated, according to Reuters, that the matter is “related to easing economic sanctions imposed on Russia.”
Crude Oil Sales Restrictions and Supply Chain Security
On Wednesday, South Korean Finance Minister Ku Yun Chol announced restrictions on the overseas sale of gasoline, arguing the commodity would be designated by the government as crucial for the security of the economic supply chain.
Prior Russian Imports and Ukraine War Impact
According to data from Korea National Oil Corporation, Seoul halted imports of Russian oil in December 2022 following Russia’s full-scale invasion of Ukraine. Previously, in 2021, Russian crude accounted for 5.6% of South Korea’s total imports.
Increased Energy Dependence on the Middle East
The state-run KIEP institute indicates that the war in Ukraine has increased the country’s energy dependence on the Middle East. Currently, South Korea imports approximately 70% of its oil and half of its gasoline through the Strait of Hormuz.
UAE Oil Supply Commitment
On Wednesday, President Yoon Suk Yeol’s special envoy to the Middle East, Kang Hun Sik, announced that the United Arab Emirates committed to supplying South Korea with an additional 18 million barrels of crude oil, bringing the total to 24 million barrels. Combined with an unspecified volume of gasoline, this was projected to help Korea avoid a “worst-case scenario” of fuel shortages.
Strategic Importance of the Strait of Hormuz
The Strait of Hormuz is a strategic sea lane through which approximately 20% of the world’s oil volume passes under normal conditions. Its potential blockage by Iran in retaliation for U.S. and Israeli strikes on Tehran, beginning February 28th, led to significant supply restrictions and a sharp increase in global fuel prices.
Gasoline’s Role in Petrochemical Production
Gasoline is used in the production of petrochemicals, which are used to manufacture plastics for industries including automotive, electronics, and construction.