ID :
195174
Fri, 07/15/2011 - 09:19
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Shortlink :
https://oananews.org//node/195174
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Oil refiners chided for steep price hikes
SEOUL, July 15 (Yonhap) -- South Korea's finance ministry criticized local oil refineries Friday for jacking up their oil supply prices too much after ending temporary price discounts.
In April, South Korea's major refineries -- SK Innovation Co., GS Caltex, S-Oil Corp. and Hyundai Oilbank Co. -- lowered their gasoline and diesel prices by 100 won (US$0.09) in line with the government's efforts to stabilize soaring energy prices and bring inflation under control.
The price reduction expired last week, raising concerns that already high oil prices at the pump could get higher and weigh on the livelihoods of low and mid-income citizens.
Reflecting current crude market situations and exchange rates, gasoline prices are projected at about 1,880 won per liter during the second week of the month, but Vice Finance Minister Yim Jong-yong said that the prices hiked to a "very high" level of 1,933 won as of Thursday.
"Considering such price-determining factors as crude prices, exchange rates, profit margins of refineries and gas stations, it is very doubtful whether there are any reasons to hike oil prices at this moment compared with the pre-discount period," Yim told an anti-inflation meeting with other policymakers.
Yim added that their argument of saying that the recent withdrawal of the price reduction translated into such a price hike at the pump is nonsensical. He called for refineries to manage their price-setting process in transparent and reasonable manners.
His remarks come as South Korea is struggling to ease growing inflationary pressure mostly driven by high energy and food prices.
South Korea's consumer prices, a main gauge of inflation, jumped 4.4 percent last month from a year earlier, exceeding the government's annual inflationary target of 4 percent for the sixth straight month.
Oil prices, among other things, have been closely monitored as they could significantly affect the livelihoods of ordinary people.
Energy prices are also a major factor that exerts upward pressure on inflation here as South Korea relies heavily on imports for its energy demand.
Local refiners have been under close watch for their "asymmetric" price setting practices, where they move swiftly to raise gasoline and other oil product prices when international crude oil prices go up but drag their feet in lowering prices when crude prices fall.
Local refineries enforced the three-month discount in April after the government launched a probe into such practices frequently blamed for keeping oil prices relatively high for local consumers.
In April, South Korea's major refineries -- SK Innovation Co., GS Caltex, S-Oil Corp. and Hyundai Oilbank Co. -- lowered their gasoline and diesel prices by 100 won (US$0.09) in line with the government's efforts to stabilize soaring energy prices and bring inflation under control.
The price reduction expired last week, raising concerns that already high oil prices at the pump could get higher and weigh on the livelihoods of low and mid-income citizens.
Reflecting current crude market situations and exchange rates, gasoline prices are projected at about 1,880 won per liter during the second week of the month, but Vice Finance Minister Yim Jong-yong said that the prices hiked to a "very high" level of 1,933 won as of Thursday.
"Considering such price-determining factors as crude prices, exchange rates, profit margins of refineries and gas stations, it is very doubtful whether there are any reasons to hike oil prices at this moment compared with the pre-discount period," Yim told an anti-inflation meeting with other policymakers.
Yim added that their argument of saying that the recent withdrawal of the price reduction translated into such a price hike at the pump is nonsensical. He called for refineries to manage their price-setting process in transparent and reasonable manners.
His remarks come as South Korea is struggling to ease growing inflationary pressure mostly driven by high energy and food prices.
South Korea's consumer prices, a main gauge of inflation, jumped 4.4 percent last month from a year earlier, exceeding the government's annual inflationary target of 4 percent for the sixth straight month.
Oil prices, among other things, have been closely monitored as they could significantly affect the livelihoods of ordinary people.
Energy prices are also a major factor that exerts upward pressure on inflation here as South Korea relies heavily on imports for its energy demand.
Local refiners have been under close watch for their "asymmetric" price setting practices, where they move swiftly to raise gasoline and other oil product prices when international crude oil prices go up but drag their feet in lowering prices when crude prices fall.
Local refineries enforced the three-month discount in April after the government launched a probe into such practices frequently blamed for keeping oil prices relatively high for local consumers.
