South Korea is securing an additional 18 million barrels of crude oil from the United Arab Emirates through diversified channels, a move prompted by the effective closure of the critical Strait of Hormuz due to the conflict between Iran and US-Israeli forces.
Approximately 70 per cent of South Korea’s crude oil imports transit the Strait of Hormuz, a chokepoint Iran has disrupted since military actions began on February 28. This dependency has forced Seoul to urgently seek alternative supply routes. According to Kang Hoon-sik, senior presidential chief of staff, the UAE will provide six million barrels via three UAE-flagged vessels, with a further 12 million barrels delivered on six Korea-flagged vessels. The specific logistics and alternate routes were not detailed.
This emergency procurement supplements a prior agreement for about four million barrels and a framework that allows South Korea to make immediate crude oil purchases from the UAE at any time. Additionally, Seoul can access up to two million barrels from strategic reserves stored jointly with the UAE within South Korea.
The supply chain stress has led South Korea, the world’s eighth-largest crude consumer, to impose a national fuel price cap for the first time in nearly three decades. As of late 2024, the nation’s daily oil consumption stands at roughly 2.5 million barrels, underscoring the scale of its import reliance.
The Strait of Hormuz, through which about a third of all seaborne traded oil passes, is a vital artery for global energy supplies. Its prolonged disruption highlights the vulnerability of major oil-importing economies to regional instability. South Korea’s rapid diplomatic and commercial engagement with the UAE to bypass the strait exemplifies the immediate operational adjustments nations are making to safeguard energy security amid the ongoing conflict. The measures, including strategic reserve access and price controls, are designed to stabilise the domestic market while longer-term supply diversification is pursued.
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