South Korea has chosen to release 7.23 million barrels of strategic crude reserves, in addition to the 4.42 million barrels it has already committed, to help bring down high energy costs amid the ongoing Ukraine crisis, the industry ministry announced on Friday.
According to the International Energy Agency (IEA), 31 member nations agreed last week to release 120 million barrels of oil from their emergency reserves, following a similar decision last month to release 60 million barrels, in response to “significant strains in oil markets resulting from Russia’s invasion of Ukraine.”
According to the Ministry of Trade, Industry, and Energy, the amount for South Korea was determined at 7.23 million barrels after negotiations among the nations. This is the greatest volume the country has ever released under such multilateral moves.
South Korea is the third-largest oil provider this time, with the US pledging to release roughly 60.56 million barrels, accounting for about half of the total.
Dubai crude, which is used as a benchmark in South Korea, hit US$103.79 a barrel on Wednesday, up from $77.12 at the end of last year. Brent crude prices jumped to $101.07 per barrel on Wednesday, up from $77.78 on December 31, according to official data.
“The decision aims to achieve energy market stability both at home and abroad, reducing the burden on our people and the economy in the midst of the prolonged Ukraine conflict and increasing energy costs,” the ministry said in a statement.
The member countries will disburse their committed amount over the next six months, according to the IEA.
Despite the scheduled release, the ministry claims that South Korea would have enough oil reserves to last more than 90 days without importing petroleum.
As the world’s third-biggest oil producer and largest exporter, Russia plays a significant role in global energy markets.