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Oil Products Are South Korea's Biggest Exports In February

By March 11, 2017 at 12:00 am
The value of South Korea's oil exports topped the value of its semiconductor exports in February. (Photo : Getty Images)

Petroleum and petrochemical products overtook semiconductors as the biggest export item for South Korea in February as refiners in China and Japan are cutting exports because of rising domestic consumption, according government data released Friday.

Last month, outbound shipments of petroleum were worth US$2.92 billion and petrochemical goods at $3.81 billion, the data showed. The combined value of $6.7 billion topped the $6.4 billion of semiconductors exports during the same period.

The increase in oil and petrochemical goods shipments is partially boosted by China's 40 percent reduction in export quotas of such goods this year from a year ago because of rising domestic consumption, according to industry sources. Also, several big Japanese refiners are undergoing regular renovations that contributed to the drop in output, according to a report by Yonhap News Agency.

South Korea's February exports surged 20.2 percent on-year and accelerated at their fastest pace in five years due to higher oil prices and an uptick in global trade, according to data by the Ministry of Trade, Industry, and Energy released earlier this month.

Total exports came at $43.2 billion in February, compared with $35.9 billion in the same month a year earlier, the ministry said. It is the first time since November 2011 that South Korea's exports have tallied a double-digit expansion for two consecutive months, according to a Yonhap report.

Saudi Arabia's state-run oil company Aramco recently said that it plans to lower the prices of crude oil for delivery starting April as China cuts oil imports from the Middle East.

An industry observer said that the move will be beneficial for South Korean refiners as they directly import in huge quantities from Aramco and other refiners in the Middle East. Other refiners in the region generally cut prices when Aramco lower theirs.

South Korea, the fourth-biggest economy in Asia, had seen a long spell in declining exports, its main economic driver, recording 19 consecutive months of negative growth between January 2015 and July 2016.

It rebounded last November and continued the uptrend for four months in a row as rising oil prices boosted demand from emerging economies. 

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