Seoul — South Korea's demand for oil products in January rose 1.2% from a year earlier driven by stronger auto fuels demand on lower retail prices, data released late Monday by Korea National Oil Corp. showed.
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Register NowThe country consumed 85.16 million barrels, or an average of 2.75 million b/d, last month, compared with 84.12 million barrels a year earlier.
This marks the first increase in six months since July when oil consumption dipped 2% from a year earlier. Consumption in January also rose 2.4% from 83.17 million barrels in December.
In 2018, the country's oil products demand decreased 0.8% to 932.69 million barrels, compared with 940.08 million barrels in 2017 when the country's oil demand rose 1.7% from 924.2 million barrels in 2016.
The rise in oil consumption in January was attributable to strong demand of auto fuels, while demand for naphtha and other products fell due to the country's economic slowdown.
Gasoil demand jumped 12.5% year on year to 15.41 million barrels in January. This marked the third consecutive increase, recovering from a 10.6% decline in October that marked the biggest decrease since February 2013.
Gasoline demand also jumped 12.6% year on year to 7.33 million barrels in January.
This marked the third consecutive increase since October last year when gasoline demand plunged by as much as 16%, the sharpest decline in 20 years since October 1998 during the Asian financial crisis.
"Demand of auto fuels has rebounded since November driven by lower retail prices on weaker international crude oil prices and the government's oil tax reduction," a KNOC official said.
The South Korean government has cut taxes on auto fuels by 15% for six months from November 6 that helped lower costs and raised domestic demand amid a slowing economy.
Taxes account for 55% of the retail gasoline price and 46% of the gasoil price, which have prompted consumers to ask for a tax reduction.
LPG consumption also climbed 9.9% year on year to 10.54 million barrels in January, which marked the third consecutive of increase after slumping for three months in a row.
But naphtha demand fell 1.8% year on year to 39.58 million barrels in January, which marked the fourth consecutive month of decline amid the country's economic slowdown.
Consumption of jet fuel also dipped 5.6% year on year to 3.33 million barrels in January.
Demand of Bunker C fuel plunged 34.6% year on year to 2.74 million barrels last month, while kerosene demand declined 7% year on year to 3.41 million barrels in January.
-- Charles Lee, newsdesk@spglobal.com
-- Edited by Irene Tang, newsdesk@spglobal.com