Joint Emergency Inspection Meeting of Relevant Ministries on Middle East Situation
"Limited Impact on Crude Oil Supply, Export-Import, and Supply Chain"
Kim Byung-hwan, First Vice Minister of the Ministry of Economy and Finance, is presiding over the "Joint Emergency Situation Inspection Meeting of Related Ministries on the Middle East Situation" held at the Government Seoul Office in Jongno-gu, Seoul, on the morning of the 16th. Photo by Ministry of Economy and Finance
Kim Byung-hwan, First Vice Minister of the Ministry of Economy and Finance, emphasized on the 16th regarding the financial and foreign exchange market instability caused by the Middle East situation, “If the market shows excessive volatility that deviates from our economic fundamentals, we will take immediate and bold measures.”
On the same day, Vice Minister Kim held an emergency joint inspection meeting with related ministries at the Government Seoul Office in Jongno-gu, Seoul, concerning the Middle East situation, stating, “We must closely monitor the situation daily and conduct 24-hour monitoring of financial and real economy trends.”
This meeting was held amid concerns that the Middle East war could escalate due to the conflict between Iran and Israel. The Ministry of Economy and Finance, Ministry of Foreign Affairs, Ministry of Trade, Industry and Energy, and other related ministries gathered to review the developments in the Middle East situation and its market impact, and to discuss follow-up measures regarding domestic impact and response directions.
Vice Minister Kim said, “Although there have been no additional armed clashes between the two sides since Iran’s airstrike on Israel, the impact on crude oil supply and demand, imports and exports, and supply chains has been limited so far,” but he urged, “Since military tensions remain high, keep all possibilities open and strengthen inspection and response.”
He particularly noted, “The Middle East supplies 72% of domestic crude oil and 32% of gas,” adding, “We must pay attention to the possibility of intensified volatility in international energy prices and thoroughly analyze and respond based on past cases to prevent disruptions in energy supply and demand.”
Vice Minister Kim also stated, “We need to form inspection and response systems by relevant ministries focusing on sectors directly affected such as energy, exports, supply chains, and logistics, and respond intensively,” and added, “We will also focus on overall price management efforts to minimize the negative impact on domestic prices caused by this situation.”
Since the Middle East accounts for more than 70% of domestic crude oil supply, the geopolitical crisis in the region inevitably increases oil price uncertainty. There are forecasts that if this conflict leads to the blockade of the Strait of Hormuz, a major export route for Middle Eastern oil-producing countries such as Saudi Arabia, Kuwait, Iran, Iraq, and the United Arab Emirates (UAE), pressure on oil prices will reach its peak. Observers suggest that if the Strait of Hormuz is blocked, oil prices could soar to $130?140 per barrel, raising concerns that rising oil prices could further drive up inflation.
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