Fuel Prices Drop in S. Korea Under New Price Cap

South Korea Fuel Prices Fall After Government Introduces Temporary Price Cap​

Retail Fuel Prices Drop Following Policy Intervention​

Fuel prices at gas stations across South Korea have declined notably after the government introduced a temporary fuel price cap last week, according to the Ministry of Trade, Industry and Resources.

Data released by the ministry shows that the average nationwide gasoline price stood at 1,840.1 won per litre as of Sunday, marking a decline of 58.7 won from Thursday, the day before the price ceiling system came into effect.

The average retail price of diesel also fell, dropping 77.8 won to 1,841.2 won per litre during the same period.

Government Introduces Price Ceiling on Refinery Supplies​

The decline in fuel prices follows the government’s decision on Friday to introduce a temporary price cap on petroleum products supplied by oil refineries to gas stations. The measure aims to reduce the financial burden on consumers amid concerns over energy supply disruptions linked to the ongoing crisis in the Middle East.

Under the system, the initial price ceilings were set at:

• 1,724 won per litre for regular gasoline
• 1,713 won per litre for diesel
• 1,320 won per litre for lamp oil

Authorities said the ceiling levels will be reviewed and adjusted every two weeks to reflect changes in international oil prices.

Retail Price Adjustment Expected to Continue​

Industry Minister Kim Jung-kwan, speaking at a meeting with industry officials on Monday, acknowledged that retail prices have been falling more slowly than expected.

He noted that many gas stations are still selling fuel from inventories purchased before the price cap system was implemented. Once those supplies are exhausted, he said, retail prices are expected to decline further.

Government Steps Up Monitoring and Market Oversight​

The government has pledged to intensify oversight of the fuel market to ensure the price cap policy benefits consumers.

Minister Kim said authorities will mobilise all available resources to ensure the impact of the maximum price system is reflected at gas stations. The government will also continue monitoring oil prices and conducting on site inspections to prevent unfair market practices.

In addition, officials plan to offer incentives to consumer friendly gas stations that maintain fair pricing, encouraging wider compliance with the policy.