The Korean government implements a temporary system to cap fuel prices
SEOUL, March 14 (WAM) – Yesterday, the Korean government announced the implementation of a temporary system to cap fuel prices. With the aim of reducing cost burdens, in light of concerns about supplies.
The Korean news agency Yonhap reported that this measure was announced during a meeting of a ministerial working group charged with managing market prices, noting that local fuel prices had witnessed fluctuations.
This is the first implementation of a price cap system in Korea since 1997, based on a provision in the Petroleum Business Law that allows the Minister of Industry to set the maximum selling price when oil prices witness sharp fluctuations that threaten the country’s economic stability.
According to the Ministry of Trade, Industry and Resources, under the price cap system, the Korean government sets the maximum prices for petroleum products supplied by oil refineries to gas stations and distributors.
The Ministry explained that it decided to apply the price ceiling to oil refinery supplies, and not to retail prices at gas stations. As retail prices vary greatly across regions, business strategies and operating practices at gas stations.
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