South Korea energy and resource diversification

South Korea has initiated a strategic shift in its resource security policy, moving from a ‘Just-in-Time’ supply model to a ‘Just-in-Case’ system to mitigate geopolitical risks. The government’s long-term objective is to reduce dependency on Middle Eastern crude oil from approximately 70% to below 50% by 2035, while also targeting natural gas dependency levels below 30%.

To achieve these goals, the nation is expanding its crude oil storage capacity and increasing the number of managed core minerals. The government is also extending mandatory storage periods for minerals vulnerable to supply chain disruptions from 180 days to a maximum of 365 days.

Recent import data indicates this diversification is already underway. Between January and August, Saudi Arabia’s share of South Korea’s total crude oil imports fell to 29.9 percent, the first drop below 30 percent since 2021. This shift is attributed to geopolitical tensions in the Middle East and potential disruptions in the Strait of Hormuz. To secure supplies, South Korea has increased imports from the United States and entered an agreement with Canada to triple the volume of Canadian crude oil imports this year.