The petroleum agency industry has called for measures, saying the distribution structure has been shaken since the government implemented a price ceiling on petroleum products.
On the 6th, the Korea Petroleum Distribution Association said in an urgent appeal that "as refiners' agency supply prices and direct supply prices to gas stations have been set the same, we cannot even reflect basic distribution expense such as storage, transportation, and labor," adding that "the industry is facing a severe management crisis."
Petroleum agencies supply oil to about 4,000 gas stations nationwide and are a key wholesale pillar handling about 43% of total volume. However, the industry said it is difficult to sustain operations because, under the current price structure, a "negative margin" persists that requires covering logistics costs of several tens of won per liter.
The association said, "At this rate, we are hearing pleas that it will be hard to hold out even a month," and warned, "If agencies halt supply or shut down, the distribution network that runs 'refiner–agency–gas station' could collapse." It noted that this could lead to supply disruptions for gas stations and inconvenience for consumers.
In response, the association demanded that agency supply prices be set lower than gas station supply prices so that agencies can perform normal distribution functions. It also argued that the reduction in agency supply prices should be reflected in measures to compensate refiners' losses.
In addition, to ease the burden on gas stations amid high oil prices, it proposed improving the current card fee system of about 1.5% of sales and temporarily lowering it to 0.8%–1.2% depending on the oil price level.
The association stressed, "With market uncertainty growing due to instability in the Middle East, stabilizing the distribution network is more important than anything," and said, "We need effective policies that reflect on-the-ground realities."