Seoul (UPI) Apr 6, 2011
South Korea will consider cutting oil taxes in an effort to stem inflation, the prime minister said Wednesday.
"We will consider cutting oil taxes after a comprehensive study on the reduction's impact to tax revenues and energy strategies," South Korean Prime Minister Kim Hwang-sik said during a government session at the National Assembly.
The country's inflation rate climbed to a 29-month high of 4.7 percent in March.
Seoul also said it was also considering allowing state-owned Korea National Oil Corp. to sell oil products in the domestic wholesale market to boost competition, Yonhap reported.
The government has been critical of pricing policies of the country's four privately owned refiners -- SK Innovation, GS Caltex, S-Oil and Hyundai Oilbank.
While South Korean President Lee Myung-bak has said he would scale back government regulation of the oil industry, the country's inflation concerns may force him to change those plans. But experts say South Korea is unlikely to move toward state-determined pricing schemes.
"I think it's pretty unlikely" that South Korea will move to state-controlled pricing, Alex Yap, an analyst at Facts Global Energy in Singapore told The Wall Street Journal. "(South) Korea is a 100 percent crude importer and any losses from price controls would have to be paid by the companies or the government, through subsidies."
Yap said Seoul might adopt policies that require more transparency for retail pricing or some sort of "anti-collusion measures" to prevent unreasonable price escalations.
"But full price controls like China or India are very unlikely," he said to the Journal.
South Korea's Ministry of Knowledge Economy earlier said it was considering the possibility of using a combination of crude oil purchase prices along with production costs to calculate oil prices, instead of the current pricing method based on the cost of refined products in the Singapore spot market.
"Oil products are usually produced from crude oil shipped about 30 to 45 days earlier, so at times of rising global oil prices, products are produced with crude oil that was imported at a cheaper price than the (latest) market price," the ministry said in a statement.
By using the original crude-oil purchase price as the benchmark, oil product prices could be lowered, it said.
As one of the world's top energy importers, South Korea ranks fifth for oil, with more than 80 percent of its shipments coming from the Middle East.
In February, South Korea consumed about 193,000 barrels of gasoline a day and exported approximately 100,000 barrels a day.
Share This Article With Planet Earth
Powering The World in the 21st Century at Energy-Daily.com
IEA calls for scrapping $312 bln in fuel subsidies
Abu Dhabi (AFP) April 6, 2011
The International Energy Agency is calling for 312 billion dollars in fuel subsidies to be scrapped in a bid to promote clean energy sources, according to a report presented in Abu Dhabi on Wednesday. "More aggressive clean energy policies are required, including the removal of fossil fuel subsidies and implementation of transparent, predictable and adaptive incentives for cleaner, more effi ... read more
Developing Commercial Hydrokinetic Energy Projects|
New Zealand to slash emissions by half
US energy future hazy on Japan, environment fears
Report: China leads in low-carbon energy
Seoul to consider oil tax cuts
US defence secretary holds talks with Saudi king
Giant Batteries For Green Power
Cuba to drill five new oil wells by 2013
Manitoba wind farm comes online
Alstom Announces Commercial Operation Of First North American Wind Farms
Vestas unveils new offshore turbine
US hopes to resolve China wind turbine rift
BlueChip Energy Announces Development Of 40MW Solar Farm In Florida
Industry Analyst Predicts 50 Percent Drop In Solar Project Costs
First Polymer Solar-Thermal Device Heats Home, Saves Money
SolarBridge Named 2011 Edison Best New Product Awards Gold Winner
Brazil re-examines nuclear plant safety
Addressing The Nuclear Waste Issue
History Of Nuclear Power Needs To Be Addressed
Bulgaria, Russia halt work on nuclear power plant
Economics, Physics Are Roadblocks For Mass-Scale Algae Biodiesel Production
Advance Toward Making Biodegradable Plastics From Waste Chicken Features
Short Rotation Energy Crops Could Help Meet UK's Renewable Energy Targets
Boeing Issues First Latin American Study On Jatropha Sustainability
What Future for Chang'e-2
China setting up new rocket production base
China's Tiangong-1 To Be Launched By Modified Long March II-F Rocket
China Expects To Launch Fifth Lunar Probe Chang'e-5 In 2017
Emissions Trading Does Not Cause Pollution Hot Spots
UN climate talks begin amid Kyoto Protocol feud
Are We Really Communicating Uncertain Climate Risks?
UN talks aim to thrash out tough details on climate
|The content herein, unless otherwise known to be public domain, are Copyright 1995-2010 - SpaceDaily. AFP and UPI Wire Stories are copyright Agence France-Presse and United Press International. ESA Portal Reports are copyright European Space Agency. All NASA sourced material is public domain. Additional copyrights may apply in whole or part to other bona fide parties. Advertising does not imply endorsement,agreement or approval of any opinions, statements or information provided by SpaceDaily on any Web page published or hosted by SpaceDaily. Privacy Statement|