South Korean prosecutors have charged all four refiners in the country with collusion on fuel prices that resulted in $17 billion in harm, Reuters has reported, citing the Korean authorities.
According to a media briefing by the lead prosecutor in the case, two refiners had coordinated on the size and timing of fuel price increases after the war between the United States and Israel, and Iran broke out at the end of February. In addition to the companies, the prosecutors also charged four employees individually.
The participating companies were not named but there are a total of four refiners in South Korea, including SK Energy, HD Hyundai Oilbank, GS Caltex, and S-Oil, Reuters noted in its report. Soith Korean media outlet Yonhap News said the two refiners that had discussed fuel price hike sizes and timings were SK Energy and HD Hyundai Oilbank.
To make matters worse, the refiners involved in the alleged price-gouging had pressured fuel station operators into raising prices in accordance with their plans through what Reuters described as unfair contracts.
“We found the surge in fuel prices following the Iran war was driven by collusion practices that had long been pervasive in the industry,” the lead prosecutor in the case told media, as quoted by Reuters. The official added that one of the charged individual employees “had exchanged pricing information with employees at rival companies over several years before the war”.
South Korea is among the most import-dependent nations in crude oil. Some 70% of these imports come from the Middle East, Reuters also noted in its report. In the early days of the war, the government imposed a ceiling on fuel prices, for the first time in three decades, to shield the economy from the worst of the fallout from the war. The country also imposed driving limits for civil servants in March to handle the potential fuel shortages coming its way.
By Charles Kennedy for Oilprice.com
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