S. Korea: Securing Crude Oil Proves More Difficult Amid Supply Hurdles in Oil & Companies News 03/04/2026 The domestic petrochemical industry has breathed a sigh of relief following an emergency injection of 27,000 tons of Russian naphtha. However, analysis suggests this volume, equivalent to only 3-4 days of domestic consumption, is insufficient to dispel fears of a supply chain collapse. It is expected to be merely a ‘stopgap measure’ to prevent operational shutdowns rather than a fundamental solution. The fundamental solution is the ‘normalization of crude oil imports.’ However, crude oil is imported in much larger units than naphtha, making it difficult to secure alternative suppliers. In this situation, it is encouraging that the government is providing some breathing room through measures like strategic petroleum reserve swaps, fending off the worst-case scenario. Nevertheless, with no clear-cut solution in sight if the Middle East crisis becomes prolonged, anxiety is growing. According to industry sources on April 2, the 27,000 tons of Russian naphtha imported by LG Chem was a shipment secured with great difficulty by leveraging a temporary easing of sanctions by the U.S. administration. However, the industry estimates that this amount can only last for about 3-4 days, even with plant operation rates lowered to a minimum. Despite this, the outlook for additional imports is bleak. First, time constraints are a major hurdle. The Russian shipment must have its unloading and payment completed by April 11. Considering the physical shipping time and financial procedures, it is highly likely that this will be the last import. Kim Dong-choon, President of LG Chem, also lamented the supply difficulties, stating, “We have secured some volume within the scope permitted by U.S. sanctions, but additional purchases are difficult.” An industry official said, “We must create a structure that allows us to hold out for as long as possible with the remaining inventory. All we can do now is shut down plants one by one as needed based on the supplies we secure, and use that volume to run the remaining ones for as long as possible.” While the government is making all-out efforts, such as activating diplomatic channels to obtain confirmation of a sanctions exemption from the U.S. Department of the Treasury, the European Union’s (EU) sanctions against Russia remain firm. Companies are hesitant to sign additional contracts due to the risk of ‘secondary sanctions’ that could arise if they export products made with Russian raw materials. Furthermore, with Iran taking the hardline stance of demanding payment for passage through the Strait of Hormuz in its own currency, competition to divert import routes to regions outside the Middle East has intensified, making the act of securing supplies itself ‘like plucking a star from the sky.’ Crude Oil Trade Units Larger, Competition Fierce… Hesitation on New Long-Term Contracts Amid Uncertainty The situation with crude oil is more severe than with naphtha. While naphtha can be purchased in relatively small batches or transported by small to medium-sized vessels, crude oil is transported in Very Large Crude Carrier (VLCC) units, making flexible responses impossible. Currently, due to the fallout from Iran’s blockade, seven vessels carrying 14 million barrels of crude oil for domestic refiners are stranded inside the Strait of Hormuz. The government has played the card of a 20 million-barrel ‘strategic petroleum rese