Seoul: South Korea has secured an additional 60 million barrels of alternative oil supplies for May, replacing supplies from the Middle East that have been blocked due to the effective closure of the Strait of Hormuz, the government announced Tuesday. The country has managed to secure a total of 110 million barrels of oil - 50 million for April and 60 million for May - from 17 countries, including Saudi Arabia, the United States, the United Arab Emirates, Brazil, and Canada, stated Yang Ghi-wuk, deputy minister for trade, industry, and resource security, during a regular press briefing.
According to Yonhap News Agency, the secured amounts for April and May represent about 60 percent and 70 percent, respectively, of South Korea's usual monthly oil supply. The oil swap system, introduced last week, has seen significant interest from the country's four major refiners, who have submitted plans to borrow more than 30 million barrels under the program. Approximately 8 million barrels are expected to be delivered this week.
Under the oil swap system, South Korean refiners can borrow crude oil from the national reserve, returning the same volume once shipments of their secured crude supplies arrive from abroad. "Refiners have expressed interest in the oil swap system and are willing to utilize it," Yang confirmed.
Regarding naphtha, a crucial raw material in petrochemical manufacturing, Yang anticipates imports for the raw material to reach 770,000 tons this month, equating to about 70 percent of the amount imported during the same month last year. The aggregate naphtha supply is projected to reach around 80 to 90 percent of the normal monthly requirement, factoring in approximately 1.1 million tons of domestically produced material.
"We plan to work with companies to make efforts in securing naphtha supplies once the supplementary budget passes and the extra budget is allocated," Yang added.