South Korea's Ministry of Climate, Energy and Environment has launched an emergency response team with state-run energy companies as military tensions escalate between the United States, Israel, and Iran. The ministry is preparing for potential electricity rate impacts should prolonged conflict drive oil prices sharply higher.
The ministry held an "Energy Situation Review Meeting" on Wednesday, chaired by Vice Minister Lee Ho-hyun, to assess how Middle East developments affect power supply conditions. Following the meeting, officials announced activation of an Energy Emergency Response Team. Representatives from Korea Electric Power Corp., Korea Hydro & Nuclear Power, the Korea Energy Economics Institute, and five state-run power generation companies attended.
The ministry determined the Iran situation poses no immediate threat to power supply. State-run generators source their directly imported liquefied natural gas from non-Middle Eastern suppliers. Even significant oil price increases typically take three to six months to affect electricity markets, providing a buffer period.
Extended regional conflict presents the greater concern. Full-scale Iranian blockade of the Strait of Hormuz would spike both oil and LNG prices. This could repeat the sharp rise in power generation costs triggered by LNG price surges during the Russia-Ukraine war.
Several state-run power companies also operate facilities in the Middle East. The ministry said it will closely monitor local conditions and prioritize employee safety for personnel stationed in the region.
"The current Middle East situation is extremely grave," Vice Minister Lee said. "The ministry and power utilities must work together to minimize impacts on the energy industry and ensure stable electricity supply."