Fuel Prices Fall Back Below 2,000 Won as Stable Global Oil Prices Raise Hopes for Further Cuts

[Financial News] Gasoline and diesel prices at domestic gas stations have both fallen below 2,000 won per liter. As global oil prices ease and the government’s seventh cap on petroleum prices takes effect, fuel prices are on a downward trend. Market watchers expect additional declines over the next two to three weeks.
According to Opinet, the oil price information service run by KNOC, the nationwide average retail price of gasoline at gas stations stood at 1,991.1 won per liter as of 9 a.m. on the 28th. That was down 5 won from the previous day’s 1,996.1 won, keeping prices below 2,000 won for a second straight day. Gasoline prices falling into the 1,900-won range for the first time in about two months came about since April 18, when they stood at 2,001.5 won.
The average diesel price also came in at 1,982.3 won per liter. After dropping below 2,000 won on the 24th for the first time in two months, diesel has remained in the 1,900-won range.
The decline in fuel prices appears to reflect both the stabilization of global oil prices and the government’s move to lower the ceiling price. At midnight on the 27th, the government applied the seventh cap on petroleum prices, cutting gasoline by 150 won to 1,784 won per liter, diesel by 150 won to 1,773 won, and kerosene by 150 won to 1,380 won. It was the first reduction in 106 days since the ceiling-price system was introduced.
Global oil prices also fell sharply. Dubai crude, which South Korea mainly imports through the Singapore spot market, dropped 34.3% in a month from $98.0 per barrel on May 26 to $64.4 on the 25th of this month. That is even lower than the $70 per barrel level seen just before the war between the United States, Israel and Iran.
However, it may take more time before consumers fully feel the impact of lower global oil prices. Each gas station still has inventory purchased at higher prices, so the timing and scale of price adjustments can vary.
The industry expects domestic fuel prices to stabilize gradually over the next two to three weeks. 
As of the fourth week of June, international gasoline prices stood at $100.6 per barrel, still 27.7% higher than the $78.8 recorded in the fourth week of February, before the war. Domestic gasoline prices also remain elevated, compared with the average retail price of 1,691.3 won in the fourth week of February.
Meanwhile, the consumer group Energy and Petroleum Market Monitoring Group said that, as of 6 a.m. on the 28th, 3,160 gas stations had lowered gasoline prices and 3,285 had lowered diesel prices compared with the 26th, the day before the seventh ceiling-price notice was issued.

going@fnnews.com Choi Ga-young Reporter