South Korean President Lee Jae Myung said rising tensions around the Strait of Hormuz were making it difficult to remain optimistic about the fallout from the Iran war, warning that high oil prices and supply-chain disruptions were likely to persist.
Speaking at a cabinet meeting on Tuesday, Lee said the government should treat prolonged disruption in global energy and raw materials markets as a given and strengthen its emergency response systems.
“For the time being, difficulties in global energy and raw materials supply chains and high oil prices will continue,” he said.
He also urged authorities to prioritise alternative supply chains, industrial restructuring and a transition to a post-plastic economy.
Government Steps Up Response
Lee called on ministries to move swiftly in deploying a supplementary budget passed in response to the conflict.
At the meeting, ministers outlined measures to contain the economic shock, including support for crude imports, controls to prevent hoarding of petrochemical feedstocks and medical supplies, and expanded financial assistance for affected companies.
Shipping Delays and Supply Concerns
Industry Minister Kim Jung-kwan said disruptions to shipping through the Strait were still affecting supplies.
Even if passage normalises, he noted, it could take around 20 days for Middle Eastern cargoes to reach South Korea.
The government is prioritising support for seven South Korea-bound oil tankers currently stuck in the Gulf region, according to a document presented at the meeting.
Diplomatic Push for Energy Security
Foreign Minister Cho Hyun said officials had been dispatched to Congo, Algeria and Libya to secure energy supplies.
Presidential Chief of Staff Kang Hoon-sik has also travelled to countries including Kazakhstan as part of the effort.
Lee urged all parties involved in the conflict to take steps towards peace based on universal human rights and historical lessons.
Energy Policy Adjustments
South Korea’s energy ministry said it would roll out a revised seasonal and time-of-use electricity pricing system to shift demand away from evening peaks towards midday, when solar generation is higher.
The new rates will take effect for large industrial users from April 16, while weekend discounts for electric-vehicle charging will begin on April 18.
Oil Storage Talks with Middle East
Meanwhile, Middle Eastern oil producers are in talks with South Korea about using its petroleum storage facilities as disruptions continue.
A senior industry ministry official, Yang Ki-wook, said countries in the region were showing growing interest in storing crude outside the Strait to reduce export risks.
In addition to Abu Dhabi National Oil Company, which already has a joint stockpiling agreement with South Korea, other producers are also in contact, though they were not identified.
(with inputs from Reuters)
