Refineries Unhappy With Cost Disclosure
Collective Resistance Expected Soon
By Kim Hyun-cheol
Staff Reporter
Oil refineries are resisting a government plan to mandate them to provide full disclosure of petroleum products prices.
The Ministry of Knowledge Economy has made a legislative notice on a revised bill concerning the oil industry earlier this month, making disclosures mandatory from May.
The new bill obligates oil firms to make weekly disclosures on a company-by-company basis.
Currently, the nation's four refineries collectively present only their average product prices weekly.
The companies are refraining from openly raising complaints on the issue for fear of presenting a negative image of the industry, but it doesn't mean they are content with the measure.
An official of a refinery here, who declined to be identified, said prices are strictly confidential and there is no international precedent.
``Every firm has its own marketing strategy and prices are the most important part of it,'' he said. ``It's simply not fair.''
They also disagree with the government's point of view that the action will guarantee a significant markdown in petroleum product prices.
``Disclosure will not lead anywhere if gas stations don't follow the move in pursuit of their own good,'' a spokesman from a different company said on condition of anonymity. ``Actually consumer prices here have been outstripping supply prices for the last three or four weeks.''
The Korea Petroleum Organization, a refineries interest group, is slated to file a suggestion to the ministry as soon as it finishes putting together legal consultation results from its members. Proposed alternatives to the legislation will enable the refiners to reveal the highest and lowest prices without identifying the refiners, the association said.
The refineries have been at odds with the government over related issues.
S-Oil and Hyundai Oilbank filed an administrative complaint over a measure from the Fair Trade Commission which prohibited them from making exclusive contracts with gas stations. Late last year, the nation's watchdog called for oil companies here to eradicate the practice in the business in which oil suppliers can gain the upper hand over gas stations.