President Lee Jae-myung on Friday called for close monitoring of local gas stations to ensure compliance with a fuel price cap, implemented to curb fluctuating costs from international uncertainty and ease consumer burdens. The government enacted the ceiling at midnight. This marks the first such measure since 1997.
On March 13, 2026, the South Korean government introduced a fuel price cap in response to international oil price instability caused by the Middle East crisis. President Lee Jae-myung stated on X that "(The government) decided to set a ceiling on supply prices to curb fluctuating fuel costs stemming from uncertainty in the international situation," emphasizing the need for public monitoring and participation to prevent unfair profits by some companies. He urged citizens to report any violations at gas stations without delay.
Industry Minister Kim Jung-kwan held a meeting with officials from oil refineries, gas stations, and the Korea National Oil Corp. on the first day of implementation, confirming early signs of market stabilization. The cap took effect at midnight Thursday, setting maximum supply prices from refineries to gas stations and distributors at 1,724 won ($1.16) per liter for regular gasoline, 1,713 won for diesel, and 1,320 won for lamp oil. The minister told reporters that price cuts were already observed in the market, with active cooperation from the industry.
Kim requested gas stations to maintain stable retail prices to pass on benefits to consumers. An intergovernmental task force on unfair fuel price practices conducted over 800 inspections, nabbing 20 cases of illicit activities. He stated during a meeting, "The fuel price cap system is a minimum safeguard to protect the national economy in a time of crisis, not a measure to control the market," vowing stern responses to hoarding and price gouging.
Addressing petrochemical supply issues with naphtha due to the crisis, the government plans to restrict exports of domestic products and review releasing reserves alongside strategic oil taps. Companies like Yeochun NCC, the largest ethylene producer, have signaled possible "force majeure" due to disruptions. South Korea imports over half its naphtha through the Strait of Hormuz, now effectively closed. The government is also considering tax measures for energy price stabilization and preparing energy vouchers for vulnerable households.
The price threshold will be readjusted every two weeks based on international oil changes until domestic prices stabilize, ending the system. This is the first enforcement since 1997 under the Petroleum Business Act, allowing the industry minister to set maximum prices during sharp fluctuations threatening economic stability.
