Saudi crude oil share in South Korea's imports falls below 30% for first time in five years
Quick Look
Saudi Arabian crude oil accounted for less than 30 percent of South Korea's crude imports in the January-August period, marking the first time in five years the share dropped below that threshold, as South Korean refiners diversify sources amid Middle East geopolitical risks and increased U.S. crude imports.
AI-generated summary
Why It Matters
Saudi Arabia has historically been South Korea's largest crude oil supplier, but recent geopolitical risks in the Middle East have prompted South Korean refiners to diversify their energy sources.
SEOUL, Oct. 5 (Yonhap) -- Saudi Arabian crude oil accounted for less than 30 percent of South Korea's crude imports this year, industry data showed Monday, amid efforts by local refiners to diversify their sources of crude following geopolitical risks in the Middle East.
According to the data from the Korea National Oil Corp. and the Korea Petroleum Association, Saudi crude accounted for 29.9 percent of the country's total crude oil imports in the January-August period, down from 30.91 percent in the previous month.
It marked the first time in five years that the share fell below the 30 percent mark. Saudi Arabia remains South Korea's largest source of crude oil.
The annual share of Saudi crude last fell below the 30 percent level in 2021, when global crude oil supplies were disrupted amid heightened tensions in the Middle East and the COVID-19 pandemic.
If the downward trend continues, Saudi Arabia's share could fall to third place or lower this year, potentially surpassing the previous low recorded in 1986, according to industry officials.
The decline is seen as reflecting efforts by South Korean refiners to diversify their crude oil supply sources and reduce their reliance on Middle Eastern crude amid growing geopolitical risks in the region.
Saudi Arabia has faced disruptions to crude oil supplies and exports as the conflict in the Middle East has affected oil facilities and raised concerns over a closure of the Strait of Hormuz.
Although Saudi Arabia has continued exports by using alternative routes around the Red Sea, shipments have come under further pressure as Houthi rebels have threatened shipping in the region.
South Korean refiners have consequently increased imports from other regions, particularly the United States.
U.S. crude accounted for 20.12 percent of South Korea's total imports in the eight-month period, remaining above 20 percent after surpassing the 20 percent mark on a cumulative basis for the first time in January-April period.
What to Watch
AI outlook — possibilities, not facts
Saudi Arabia's share of South Korea's crude imports could fall to third place or lower if current trends continue
Possible · Within months
Open Questions
- How will Saudi Arabia respond to declining market share in South Korea?
- What specific alternative routes are being used around the Red Sea to maintain Saudi exports?
- Will U.S. crude continue to gain market share in South Korea beyond current levels?
