South Korea secures 76% of April crude needs amid Middle East disruptions

South Korea secured 76% of its monthly crude oil requirements in April despite a sharp decline in sour crude imports from the Persian Gulf, as the government and private refiners worked closely to ramp up future shipments from the Americas, Oceania and key Middle Eastern hubs such as Fujairah in the UAE and Yanbu in Saudi Arabia, according to the trade ministry, state-run Korea National Oil Corp. and refining sources over May 22-28.

Asia’s third-largest crude buyer imported 32.48 million barrels of crude from Middle Eastern suppliers in April, representing a decline of 38.6% from the previous year, as several VLCCs and Suezmax tankers failed to load or deliver medium and heavy sour Iraqi, Saudi and Kuwaiti grades on schedule due to outbreak of the war in the region, said feedstock managers at three Ulsan- and Yeosu-based refiners, citing the latest data from KNOC, issued May 26.

Shipments from Qatar were absent in April, compared with typical monthly arrivals of 5 million to 6 million barrels of deodorized field condensate and low-sulfur condensate, according to KNOC data.

The refining sector secured 64.498 million barrels of crude feedstock in April, equivalent to 76.4% of the five-year average monthly intake of 84.46 million barrels, supported mainly by strong US crude imports and increased shipments from Australia, Canada and Africa, KNOC data showed.

Since the start of the Middle East war, the South Korean government and private sector have operated as a unified front, activating a full-scale response system, the Ministry of Trade, Industry and Resources said in a statement May 28.

“As a result, they have managed the supply and demand of crude oil, naphtha, and other products stably, minimizing the impact on the real economy and people's livelihoods,” the ministry said.

South Korea's diplomatic and maritime support for importing light and medium sour Abu Dhabi grades loaded from Fujairah, as well as Arab Light crude deliveries through the Red Sea, will remain vital for domestic refineries supplying key fuels such as gasoline, diesel and jet fuel to both local and Asia-Pacific markets, feedstock managers and product marketing executives at the three refiners told Platts.

The country's shipments from the UAE in April rose 82.7% year over year to 10.76 million barrels, KNOC data showed.

Reflecting improvements in tanker flows of Middle Eastern crude in recent weeks, the international physical sour crude benchmark, Platts Cash Dubai’s premium, has weakened so far in May.