1% of domestic delivery rate… May act as a factor for rising oil prices
Although the West has agreed to a price cap on Russian crude oil, the immediate impact on domestic supply and demand is expected to be limited.
This is because the share of Russian crude oil imported into Korea is negligible, at about 1%.
According to industry and foreign media on the 5th, the European Union (EU) agreed on the 2nd (local time) to set the price ceiling for Russian crude oil at $60 per barrel to make it difficult for Russia to finance its war.
This is about 10 dollars (about 13,000 won) lower than the current price of Ural oil in Russia, which is 70 dollars (about 91,000 won) per barrel.
Seven major countries (G7), including the United States, Japan, and the United Kingdom, and Australia also decided to join the EU’s cap on Russian crude oil prices.
The cap on the price of Russian crude oil will come into effect as early as this day.
The G7, the EU and Australia ban maritime services, such as insurance and transport, for Russian crude exported at prices above the cap.
Previously, the South Korean government had expressed its principled position that it would join the US-led Russian crude oil price cap system.
In a meeting with US Treasury Secretary Janet Yellen in July, Deputy Prime Minister and Minister of Strategy and Finance Choo Kyung-ho said, “We agree with the purpose of the presentation and are ready to participate.”
However, the share of oil imported from Russia has continued to decrease and the amount is not large, so the oil refining industry expects that there will be no significant impact on supply and demand.
According to the Korea Petroleum Association, in October, Saudi Arabia 34.8%, the United States 16.3%, the United Arab Emirates 9.0%, Iraq 8.6%, and Kuwait 7.5%.
On the other hand, the share of Russian crude oil was 0.96%, less than 1%.
The share of Russian products, which reached 5.53% in January, started to fall after the invasion of Ukraine and has fallen to around 1.0% since May.
However, if the international oil price rises as the distribution of Russian crude oil is blocked, Korea may also be indirectly affected, so the industry is keeping a close eye on the situation.
An official from the Korea Petroleum Association said, “The price ceiling system itself can act as a factor in increasing international oil prices rather than affecting supply and demand in Korea. He explained.
However, he added, “If Russia supplies through the so-called ‘shadow fleet’, the increase in oil prices may not be large because the supplies are not completely tied up.”
/happy news
