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S. Korea to consider release of oil reserves if Mideast tension worsens

All News 09:05 January 07, 2020

SEOUL, Jan. 7 (Yonhap) -- South Korea will consider releasing oil from its strategic oil reserves if there is a crisis on securing oil supplies amid escalating tensions in the Middle East following last week's killing of a top Iranian general by a U.S. drone strike, a senior government official said Tuesday.

Vice Finance Minister Kim Yong-beom told a meeting with economy-related vice ministers that the country is fully prepared to deal with any fallout from the heightened tensions in the Middle East.

The government will closely monitor financial markets and swiftly take actions if volatility rises in the wake of the Middle East tensions, Kim said.

As of end-November, the amount of the government's oil reserves came to 96.5 million barrels. When considering the savings from the private sector, the amount is estimated at 200 million barrels.

S. Korea to consider release of oil reserves if Mideast tension worsens - 1

Kim said there is no short-term impact on South Korea's imports of oil, but the country still needs to closely monitor the situations, considering its heavy dependency on the Middle East for energy.

The Middle East accounted for 70 percent of South Korea's imports of crude over the January-November period of 2019. That of liquefied natural gas (LNG) was estimated at 38 percent.

Tensions have been sharply rising since last week's killing of Gen. Qassem Soleimani, arguably Iran's most powerful commander, by a U.S. air strike.

Global oil prices have soared, raising concerns that a much-awaited recovery in exports may be further delayed.

With the Middle East tensions knocking investor sentiment, South Korean stocks dropped and the won currency weakened Monday.

The stock market's main KOSPI index dived 0.98 percent to close at 2,155.07 on Monday.

kdh@yna.co.kr
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