Oil Price Sails Up and Up

If the price of a barrel of crude petroleum rises by one dollar in the international market, Korea's trade balance will worsen 10.6 billion dollars and the price of gasoline in Korea will also rise by 14 won per liter, the Ministry of Commerce, Industry and Energy forecasted.
The ministry reported on April 26 that oil prices are likely to rise by one to two dollars per barrel due to production curtailment of oil producing countries, and the domestic economy will feel the effects in about one month.
A source in the ministy said that oil prices show a continuous upward tendency that induces additional increases in domestic prices, although the price of gas has already risen 2.7 percent on average in Korea this year.
A one-dollar increase in the price of crude oil per barrel will cause a 2.5 percent jump in the domestic market's price and even affect the consumer price index by a 0.1 percentage point increase.
A high-ranking official in the ministry said, 'The rising price of crude petroleum is more rapid than expected. If the price of Dubai oil rises to 20 dollars per barrel from the current 15 dollars, the domestic price will go up to the level of 1,400 won.'
He added, 'In the case of battles among oil companies or consumers to acquire petroleum, it could rise to the 1,500 won mark.'
Jooan Kang : jooan@joongang.co.kr