Inflation Shock of 3.1% Despite Securing 200 Days of Government and Private Reserves; Agencies View "Normalization of Passage in June as the Turning Point"
The word that shook the global energy market in the first half of 2026 is undoubtedly "Hormuz." The crisis escalated on February 28 when the Islamic Revolutionary Guard Corps (IRGC) Navy of Iran broadcast via VHF radio frequencies that "passage through the Strait of Hormuz is prohibited." Although partial normalization has since progressed, a phase of "partial recovery and persistent risks," where partial passage recovery coexists with geopolitical tensions, continues as of June. Now, over 100 days into the blockade, South Korea's energy security status has been examined from three aspects: reserves, oil prices, and structural risks.
South Korea's Strategic Reserves: 200 Days Combined Government and Private; 6th Globally by IEA Standards
To start with the conclusion, short-term supply and demand capacity is "fairly sufficient." According to the Korea National Oil Corporation (KNOC), as of the end of February 2026, 9 storage bases with a total storage capacity of 146 million barrels were in operation domestically, and government strategic reserves stood at approximately 100 million barrels (excluding joint stockpile volumes). Vice Minister of Trade, Industry, and Energy Moon Shin-hak stated during a briefing at the "Emergency Inter-ministerial Meeting to Review the Middle East Situation" on March 3 that the combined government and private petroleum reserves are sufficient for over 200 days of use.
It also ranks high in international comparisons. According to the KNOC, as of the end of September 2025, South Korea's days of petroleum reserve continuation ranked 6th globally, following the Netherlands, Denmark, Finland, Hungary, and Japan, based on IEA standards. The IEA recommends member countries secure a minimum of 90 days worth of strategic reserves based on net crude oil imports, a level South Korea significantly exceeds.
However, strategic reserves have already been released on a large scale once. In March, the government decided to release a record 22.46 million barrels as part of the IEA member countries' joint release (totaling 400 million barrels). This is approximately twice the previous record release during the Russia-Ukraine war in 2022 (11.65 million barrels) and accounts for about 5.6% of the total IEA volume. Given that South Korea's average daily domestic petroleum consumption is about 2.8 million barrels, this volume corresponds to roughly 8 days. The remaining government strategic reserves after the release are estimated to be around 80 million barrels. Based on a simple calculation using 2.8 million barrels, government reserves alone can sustain the country for about 29 days, and combined with private inventory and imported volumes in transit, it is structured to last for over six months as announced by the government.
Where Have Oil Prices Landed... Brent Reaches $119, Followed by a Battle in the $90 Range
This year's oil price trends were extreme. Brent crude dropped to $59.45 per barrel on January 6, hit a yearly high of $119.4 on March 8 when the blockade shock peaked, and the annual average for 2026 stands around $87.35. Entering June, WTI has traded in the $89-$93 per barrel range, calming down from its peak, but still remains over 50% higher than pre-crisis levels ($50-$60 range).
Domestic perceived prices are also soaring. According to Opinet, the average gasoline price at gas stations nationwide at the end of May was about 2,010 won per liter, and diesel was about 2,005 won per liter, solidifying the 2,000 won per liter mark. The government maintained the petroleum ceiling price system introduced in March and froze ceiling prices in May as well. Vice Minister Moon Shin-hak cited people's livelihood and price stabilization as the reasons for the freeze, stating, "The rise in oil prices leads to increased logistics and production costs, increasing the burden on truck drivers, delivery workers, and agricultural and fishery workers."