In response to energy supply instability from a prolonged shutdown of the Strait of Hormuz, the government will release strategic oil reserves in April and implement export restrictions on naphtha. It will also launch a supply chain support center to conduct constant monitoring of items closely tied to people's daily lives.
Yang Gi-uk, director general for industrial resource security at the Ministry of Trade, Industry and Resources, said at a briefing of the Middle East Situation Response Headquarters on the 23rd, "We are consulting with refiners on specific release criteria, and there will be a separate announcement before the release," and stated accordingly.
The Ministry of Trade and Industry (MOTI) plans to prioritize allocation of the naphtha produced during the release of reserves to the domestic petrochemical industry. Deputy Minister Yang said, "We will release reserves in mid-April while implementing export restrictions at the same time, and we will distribute the resulting naphtha evenly to petrochemical corporations."
About 55% of domestic naphtha demand is covered by local refiners, with the remaining 45% relying on direct imports. With Middle Eastern naphtha supplies blocked, concerns over shutdowns are growing among companies with high dependence on direct imports. The government plans to minimize supply disruptions to these companies through emergency supply-demand adjustments in cooperation with refiners.
Deputy Minister Yang said, "It's not impossible to source naphtha elsewhere," but added, "The biggest problem is that prices keep rising." He continued, "We expect that supply and demand will be manageable through late April to early May. We will keep pushing this back through supply-demand adjustments."
Authorities are also addressing the supply of ethylene gas, which the shipbuilding industry needs for steel plate cutting. The Ministry of Trade and Industry (MOTI) has secured priority ethylene gas supply to shipbuilders through consultations with the chemical industry. Park Dong-il, deputy minister for industrial policy at the ministry, said, "The volume used in the shipbuilding institutional sector is not large, so we expect to supply without disruption."
A monitoring system for supply chain stabilization also goes into full operation starting today. The Ministry of Trade and Industry (MOTI) launched a 12-person "supply chain support center" and decided to prioritize 30 to 40 items closely tied to daily life and industrial production, such as petrochemical products, for inspection. The government will identify industry difficulties in real time to seek solutions at the government level, while flexibly expanding the target items as conditions change.
Deputy Minister Park said, "It wouldn't be appropriate to disclose individual items under review, but because petrochemical products are basic raw materials for nearly all manufacturing sectors, the ripple effects are significant," adding, "We will respond meticulously with a sense of urgency."