Industry Minister Kim Jung-kwan said Korea will expand imports of U.S. crude oil, citing that supply chain issues will not be resolved even after the end of the Iran war. In a media interview on the 19th, Kim said, "Despite experiencing several Middle East wars in the past, we failed to diversify because we were pushed by the economic logic of securing oil cheaply and quickly." Kim added, "In the process of reducing dependence on Middle Eastern oil, it is inevitable that the share of the United States, the world's largest crude oil exporter, will grow," signaling the combined use of U.S. light crude and Middle Eastern heavy crude.
Korea, which imports 70 percent of its crude oil through the Strait of Hormuz, has suffered serious "energy crises" each time geopolitical tensions flared in the Middle East. Kim's plan to "de-risk" Middle Eastern crude by increasing oil purchases from the United States and other countries is an essential choice to adapt to the changing times. The past "just-in-time" approach of importing only the necessary amounts at the right time has reached its limits. As confirmed during the Middle East war, a shift toward a "just-in-case" strategy, which diversifies import sources to prepare for contingencies, has become unavoidable.
Diversification of import sources to non-Middle Eastern countries must be accelerated. In particular, expanding U.S. crude oil imports is expected to yield a dual benefit that goes beyond simply adding another supply chain — it could also ease the mounting tariff pressure from the United States. It could serve as a means to somewhat alleviate the trade surplus with the U.S., which President Donald Trump has used as grounds for trade pressure and potential currency manipulator designation against Korea. It could also be a clever move that gives President Trump the justification of crude oil exports while allowing Korea to secure the practical gains of strengthened supply chains and eased trade pressure.
The challenge lies in execution. Refiners must move beyond facility investments tailored to Middle Eastern heavy crude and significantly expand investment in light crude areas such as U.S. shale oil. The government should support this through expanded investment tax credits, priority access to the supply chain stabilization fund, and low-interest policy loans. To anchor supply chain diversification, more refined improvements to the transportation cost subsidy system for non-Middle Eastern crude are needed. Timely infrastructure investments in combined crude oil and natural gas terminals and in ports capable of accommodating tankers are also essential.
