Biggest cut in fuel tax… Gasoline and diesel prices have finally fallen

A gas station in downtown Seoul on June 29. photo = Yonhap News

Gasoline and diesel prices at domestic gas stations fell from the previous day on the 1st, when the fuel tax cut was expanded from 30% to 37%.

According to the Korea National Oil Corporation oil price information service Opinet, as of 9 am on the same day, the national average gasoline price was 2,133.53 won per liter, down 11.37 won from the previous day. The national average diesel price fell by 7.38 won during the same period to 2160.28 won per liter.

The rise in domestic gasoline and diesel prices, which has set record highs every day, seems to be slowing down as the fuel tax cuts widen.

As of this day, the extent of the fuel tax cut has been expanded from 30% to 37%. As a result, gasoline prices were reduced by 57 won per liter and diesel by 38 won per liter. However, it is likely that it will take some time for the effect of the fuel tax cut to come out clearly. It usually takes two weeks for petroleum products to be distributed from an oil refinery to a gas station, as the oil tax is applied the moment they are taken out of the refinery. Accordingly, it is expected that consumers will be able to experience the effect of the fuel tax cut more quickly when refiners reduce the time lag through inventory management and cooperation with gas stations.

From today, domestic refiners immediately reflected the cuts and supplied them. Directly managed gas stations across the country also lowered their selling prices by the same amount as the fuel tax cuts. However, in the case of general self-employed gas stations, it is expected that the price will be lowered after exhausting all the stocks supplied before the additional fuel tax cut, so it will take some time for the additional fuel tax cut to take effect 100%.

The government lowered the fuel tax by 20% from November 12 last year to ease the burden on oil prices, and expanded the cut to 30% from May 1 of this year. As domestic gasoline and diesel prices were not set despite these measures, the government expanded the cut to 37% from today.

Reporter Kim Soo-hyun at [email protected]

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