MOLIT extends diesel fuel price-linked subsidy until April, raises support rate to 70%

According to Financial News, the government will expand its diesel fuel price-linked subsidy to ease fuel costs for the transport and logistics sectors in response to the recent rise in global oil prices.
The Ministry of Land, Infrastructure and Transport (MOLIT) announced on the 11th that it will extend the diesel fuel price-linked subsidy, which ended in February, for two more months from March through April. The measure comes as domestic diesel prices have climbed due to higher international oil prices driven by instability in the Middle East. The per-liter subsidy amount will also be increased from the previous level.
The diesel fuel price-linked subsidy was introduced in April 2022 to reduce the burden on the transport and logistics industries, where fuel accounts for a large share of operating costs when oil prices surge. When the diesel price exceeds the reference level of 1,700 won per liter, a certain percentage of the excess amount is subsidized.
For example, if diesel costs 2,000 won per liter, 150 won is subsidized, which is half of the 300 won above the reference price. The maximum subsidy is 183 won per liter. The program covers 380,000 diesel-powered trucks, 16,000 route buses and about 270 taxis.
To respond preemptively to the high oil price situation, MOLIT has revised its subsidy payment guidelines so that diesel fuel price-linked subsidies will be paid from March 11 through April. The subsidy will also be applied retroactively to fuel purchased by operators between March 1 and 10.
In addition, the ministry plans to raise the support rate from the current 50% to 70% of the amount exceeding the reference price of 1,700 won per liter. Once the related guidelines are revised, the higher rate will be applied retroactively to fuel purchases made on or after March 1.
Based on a 25-ton truck using an average of 2,402 liters of fuel per month, MOLIT explained that the diesel fuel price-linked subsidy is expected to reduce monthly fuel costs by up to 440,000 won.
MOLIT added that it will continue to closely monitor volatile oil market conditions even after this measure and will consider additional support if necessary.
en1302@fnnews.com Jang In-seo Reporter