South Korea will lower its fuel price cap in its next monthly adjustment as the government seeks to ease inflationary pressures while maintaining price stability, Finance Minister Koo Yun-cheol said.
Speaking on Friday, Koo said the government had decided to keep the current sixth fuel price cap unchanged this week due to uncertainty surrounding the situation in the Middle East.
“We kept the sixth fuel cap price unchanged this week due to uncertainty of the Middle East situation, but the seventh cap will be lower than the current level and maintained until consumer prices stabilise,” he said.
South Korea introduced nationwide fuel price caps in March, marking the first such measure in decades. The ceiling is reviewed and adjusted every month by the authorities.
The announcement comes after South Korea’s consumer inflation accelerated to 3.1% in May, its highest level in more than two years. Rising oil prices linked to the conflict in the Middle East drove the increase, reinforcing expectations that the Bank of Korea could begin tightening monetary policy as early as next month.
Koo said the government would continue implementing policies aimed at bringing consumer inflation below 3% during the second half of the year.
The latest move reflects Seoul’s efforts to balance inflation control with concerns over energy costs, as global oil prices have shown signs of easing following recent geopolitical volatility.
Reuters
