Kang Hoon-sik, chief of staff to the president, said on the 24th that, regarding crude oil supply and demand amid the prolonged situation in the Middle East, "In May, we secured 74.62 million barrels, which is 87% of last year's average monthly import volume, so there is no need to be greatly concerned about supply disruptions." He also said that although U.S.-Iran cease-fire talks remain uncertain and the Hormuz closure continues, the country is lowering its dependence on Middle Eastern supplies to the 50% range by diversifying sources.
At a briefing at Chunchugwan in the Blue House on the afternoon of the day, Chief of Staff Kang said, "Even amid the uncertainty of the Middle East war, the Korean economy is holding firm and moving forward," and continued. Regarding the first-quarter gross domestic product (GDP) growth rate announced the previous day, he said, "It far exceeded market expectations, posting a 1.7% increase from the previous quarter and 3.6% from a year earlier," adding, "The 1.7% growth is the highest since the third quarter of 2020, in five and a half years."
Kang said, "International oil and raw material prices remain high, and the impact of the Middle East war on perceived inflation may be just beginning," adding, "This is why the government is striving to ensure the swift execution of the supplementary budget for high oil price damage payments and subsidies."
He also said efforts are underway to secure alternative crude volumes. Kang said, "By additionally securing volumes from the Americas and Africa, we reduced dependence on Middle Eastern supplies by 13 percentage points, from 69% to 56%," adding, "In addition to diversifying (crude) import countries, we are also diversifying the routes taken by tankers."
The government implemented the fourth oil price cap on the day. However, it froze prices out of concern that cuts would lead to higher consumption. Some said prices were frozen even though there was room to cut gasoline by about 100 won and diesel by about 200 won, reflecting the drop in international prices. In response, a Blue House official said, "There were factors for increases in the second and third rounds that were not applied, and considering the accumulated unreflected portion, the fourth-round price should raise gasoline by 125 won and diesel by 628 won," adding, "Nevertheless, we froze prices in consideration of people's livelihoods and inflation pressure."