SK Energy, South Korea's largest oil refiner, will cut prices this week following months of pressure from the government which is battling to curb inflation, its parent company said Sunday. SK Innovation said prices of petrol and diesel at some 4,000 SK Energy garages would be cut by 100 won (9.2 cents) a litre for three months from April 7.
"This really was not an easy decision for us to make, considering the losses to come," SK Innovation said in a statement, adding the move was to support government efforts to rein in inflation.
"The decision was made despite global price hikes amid political unrest in the Arab world and economic fallout of the quake disaster in Japan," it said. South Korea relies entirely on imports for its oil needs, making it vulnerable to turbulence of the kind shaking up North Africa and the Middle East.
Consumer prices in March rose at the fastest pace in 29 months despite the government's pledge to make combating inflation its top economic priority.
The Bank of Korea last month raised the key interest rate for the second time this year to ease inflation, which President Lee Myung-Bak called a greater concern than growth this year.
Knowledge economy minister Choi Joong-Kyung on Sunday praised the price cut, saying "all parties in economic activities should share each other's pain to overcome difficulties."
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