The government lowered refiners' supply prices by more than 200 won per liter at most to rein in soaring fuel costs triggered by the U.S.-Iran war, but gas station retail prices fell by less than half that amount.
With gas stations reflecting only part of the supply price cuts, critics say consumers feel less relief than expected.
According to Opinet, the Korea National Oil Corporation (KNOC) oil price information system, as of 2 p.m. on the 15th, the nationwide average gasoline price at gas stations was 1,840.9 won per liter, down 4.5 won from the previous day. Automotive diesel was 1,842.1 won at the same time, down 5.9 won.
Starting at midnight on the 13th, the government implemented a "maximum oil price system" that caps the wholesale prices refiners charge gas stations. For the next two weeks, the wholesale caps are set at 1,724 won per liter for gasoline, 1,713 won for diesel, and 1,320 won for kerosene. Compared with the average supply prices submitted by refiners on the 11th, these are lower by 109 won for gasoline, 218 won for diesel, and 408 won for kerosene.
However, in the three days since the system took effect, actual retail prices at gas stations fell only 57.9 won for gasoline and 76.9 won for diesel. That means roughly 53% of the gasoline cut and 35% of the diesel cut in supply prices have been reflected in consumer prices.
Some also note that the pace of price cuts is relatively slow compared with how quickly gas stations raised prices after the recent war—about 200 won for gasoline and about 300 won for diesel.
Industry officials say inventory burdens are a key factor slowing price adjustments. When stocks purchased at high prices remain, immediate price cuts are difficult, they explain. They add that sales volumes and the speed of inventory drawdowns vary greatly by station, leading to differences in when prices are adjusted.
Trends also differ by station type. Company-owned stations and budget stations run by the oil corporation and NongHyup are lowering prices relatively quickly and leading overall declines, while general stations are slower to cut prices due to revenue pressures.
The government expects price stabilization effects to gradually emerge starting next week. The Ministry of Trade, Industry and Resources plans to strengthen nationwide monitoring of gas station prices to ensure the supply price cuts are properly reflected in consumer retail prices.