Seoul: The government issued Thursday a precautionary alert over a possible energy supply disruption amid an ongoing geopolitical crisis in the Middle East, the industry ministry said, vowing a stern response to unfair market practices involving energy supply and prices.
According to Yonhap News Agency, the government issued the Level 1, or blue, alert in the country's four-tier national resource security warning system to respond preemptively to a possible disruption in Korea's energy supply due to the Iran crisis, as noted by the Ministry of Trade, Industry and Resources. The ministry emphasized the country's readiness to handle a potential prolonging of the Middle East conflict.
Officials confirmed that while the country has not yet faced any disruptions in energy supplies and maintains sufficient short-term supply capacity, the alert was issued to proactively address a potential resource crisis and minimize any adverse effects on people's livelihoods and domestic businesses. South Korea's oil reserves are adequate for 208 days, and the country is capable of securing alternative supplies for most industrial materials, parts, and equipment.
Since the U.S. and Israel initiated attacks against Iran over the weekend, international oil prices have surged by more than 10 percent. The effective closure of the Strait of Hormuz, a crucial oil export route, has further intensified concerns over energy market volatility. In response, the government has been working to secure additional oil and gas supplies from non-Middle Eastern regions while preparing for the release of oil reserves.
The government has also committed to a stern response to unfair market practices, such as illicit oil distribution, hording and profiteering, collusion, and price gouging, which can exacerbate energy price volatility. The industry ministry announced an intensive crackdown on such practices starting Friday and urged local oil refineries and gas station operators to avoid excessive price hikes.
The finance ministry stated it will employ all possible administrative measures, including a price cap on petroleum, to stabilize the domestic energy market. "Since it is difficult to predict when the (Middle Eastern) conflict will end, the government will maintain full readiness and monitor the situation very seriously," Industry Minister Kim Jung-kwan said in a press release, promising a "timely" response to any energy supply disruptions.