Chairman Kim Hyo-seok of the Korea Petroleum Association.

Chairman Kim Hyo-seok of the Korea Petroleum Association said on Nov. 6 in an interview with a local daily that he will work for the oil industry and the government to streamline energy policy matters while leading the association.

Kim, who took over the association as the 22nd chairman on Nov. 6, said the world oil refinery industry is faced with the challenge of turning itself around to have an environment-friendly paradigm. The representatives of four oil majors in the country met for the 37th general meeting at Lotte Hotel in downtown Seoul and unanimously agreed to name the former legislator to head the association. The CEO position became vacant with the death of its former chairman, Kang Bong-kyun, in February. The new chairman is to serve the remainder of the former chairman’s tenure until September, next year.

The new chairman was the co-campaign manager for candidate Moon Jae-in during the presidential election last year and some criticized his.

But officials at the petroleum association said the association is not a public organization and its member companies can name any qualified candidate of their choice to head the association.

The Korea Petroleum Association announced on Jan. 25 that the four largest South Korean oil refiners SK Energy, GS Caltex, S-Oil and Hyundai Oil Bank recorded a total oil product export of 455.246 million barrels last year, up 0.7% from a year ago, to reach an all-time high. The export rose for the fourth consecutive year.

Still, the value of exports fell 20% year on year to $22.70637 billion due to low oil prices. The four companies recorded crude oil imports of $40.2 billion last year and the ratio of their oil product exports to their crude oil imports has remained around 50% for years.

The number of countries to which those products were export increased from 55 to 66 between 2014 and 2015 and to 67 last year. 19% of the exported products were shipped to China and it was followed by Singapore (16%), Australia (10%), Japan (9%) and Taiwan (6%) and the United States (6%). Diesel fuel accounted for 37% of the products, followed by jet fuel (21%), gasoline (16%) and naphtha (10%). The diesel fuel export to China soared by approximately 270% from 2.75 million barrels to 10.12 million barrels between 2015 and 2016.

“This year, the export is estimated to exceed US$30 billion, led by an increase in oil price, in spite of some risk factors such as the spread of trade protectionism and diesel fuel import from China,” the association explained.

Kuwait is making a concerted effort to retain its importance as a reliable crude oil supplier to South Korea, where it has seen its market share dip as Korean refiners, spoilt for choice, have picked up more barrels from Iraq and Iran.

A high-profile delegation led by Kuwaiti Prime Minister Sheikh Jaber Al-Mubarak Al-Hamad Al-Sabah and Deputy Prime Minister and Acting Oil Minister Anas Khalid Al Saleh is in Seoul this week where they met with several South Korean leaders, including President Park Geun-Hye and her energy minister, and chief of the country's biggest refiner, among others.

Kuwait has seen its market share in South Korea's total crude imports drop to 14% in Q1 2016 from 14.7% in Q1 2015 as Iraq has raised its share to 14.3% from 12.9% and Iran to 8.6% from 4.2% over the same period, data from state-run Korea National Oil Corp. showed.

Kuwait supplied 37.41 million barrels in Q1 2016, up 3.3% year on year.

This compares with Iraq's 38.05 million barrels, up almost 20% year on year, and Iran's 22.85 million barrels, up nearly 123%.

"Middle East oil producers are striving to tighten relations with customers in the Asia-Pacific region, the biggest market for their crude," an official at the Korea Petroleum Association said Tuesday. "They are struggling to maintain their share in the South Korean market in the face of increasing shipments from Iran and Iraq," he said. 

New KPA Chmn. Kim Hyo-seok, 3rd R, is  lined-up with the representatives of the four major oil companies in Korea, including SK Energy President Kim Joon, GS Caltex President Huh Jin-soo, S-Oil President Othman Al-Ghamdi, and Hyundai Oilbank President Moon Jong-bak, who selected the former legislator  to serve the remaining tenure of the late chairman Kang Bong-kyun who died in February as the 22nd chairman at the 37th general meeting of the KPA at Lotte Hotel in Seoul on Nov. 6.(Photos: KPA)