South Korea indicts four refiners in fuel price collusion case
Prosecutors allege domestic refiners coordinated fuel price increases after the U.S.-Iran conflict, with impact estimated at about 26 trillion won.
By Marcus V. Thorne · Markets Editor
· 2 min read
South Korean prosecutors indicted four domestic oil refiners on Monday for alleged violations of the country’s fair trade law, accusing them of colluding to lift fuel prices after conflict in the Middle East. Prosecutors put the alleged collusive sales between HD Hyundai Oilbank and SK Energy at 14.2 trillion won, or about $9.2 billion, while the broader anticompetitive impact reached roughly 26 trillion won when GS Caltex and S-Oil were included, Yonhap News Agency reported.
The companies named in the case are HD Hyundai Oilbank, SK Energy, GS Caltex and S-Oil, according to Yonhap. Prosecutors allege the conduct helped drive a sharp increase in domestic oil prices after the U.S.-Iran conflict, making the case a significant test of South Korea’s competition enforcement in a sector central to household costs and industrial supply chains.
Alleged pricing coordination
Yonhap reported, citing prosecutors, that pricing executives at HD Hyundai Oilbank and SK Energy coordinated the timing and size of price increases. In such an arrangement, competitors can reduce price pressure by aligning when they raise prices and by how much, rather than letting market share and supply conditions determine separate pricing decisions.
Prosecutors said GS Caltex and S-Oil allegedly followed those prices, according to Yonhap. The report did not say prosecutors accused those two companies of participating in the same direct communications as the other two refiners, but said their alleged price-mirroring contributed to the wider 26 trillion won impact estimate.
The prosecution described the alleged conduct as a long-running and systemic practice that became visible during a period of global stress, Yonhap reported. Prosecutors said the investigation began after domestic fuel prices rose sharply following the U.S.-Iran conflict.
Political and market response
The case follows a public warning in March from South Korean President Lee Jae Myung, who wrote on X that oil refiners and companies involved in price-fixing would face accountability. Lee said at the time that lawful measures would be used against unethical business practices.
The indictments did not coincide with selling in the named companies and their listed owners in the market moves reported by CNBC. S-Oil rose 6.08%, SK Innovation, the parent of SK Energy, gained 1.58%, HD Hyundai advanced 1.21%, and GS Holdings climbed 6.99%. GS Holdings jointly controls GS Caltex with Chevron through its energy unit, according to the report.
S-Oil declined to comment, CNBC reported. HD Hyundai Oilbank, SK Energy and GS Caltex could not be reached immediately for comment.
The allegations remain subject to the legal process. Prosecutors have accused the refiners of breaching South Korea’s fair trade rules, but the companies’ liability will be determined through the courts.
This story draws on original reporting from CNBC.
