S.Korea and Australia strengthen energy co-operation
South Korea and Australia have agreed to strengthen cooperation in the energy sector as they deal with fuel supply disruptions caused by the Iran war.
Following a meeting in Seoul on Thursday between Australian Foreign Minister Penny Wong, her South Korean counterpart Cho Hyun and Energy Minister Kim Jong-kwan, both countries agreed to “maintain a stable, safe and reliable supply of diesel and other liquid fuels”.
Wong’s visit to Seoul is part of a three-country tour that also includes China and Japan, where Australia is coordinating with regional powers on energy security.
Crude oil prices have risen since the US-Israel began attacking Iran on February 28. This attack resulted in Tehran effectively closing the Strait of Hormuz, through which one-fifth of the world’s oil passes.
According to the joint statement, Australia and South Korea also agreed to notify and consult with each other in the event of potential trade disruptions due to “deep concerns” about the impact of the situation in the Middle East on key sectors of raw materials.
“The central pillar of our Comprehensive Strategic Partnership is a long and reliable economic and energy resources partnership based on a shared commitment to open markets and rules-based trade that supports our prosperity and economic security,” the countries said.
Canberra is Seoul’s main supplier of liquefied natural gas, as well as a major supplier of key minerals; South Korea supplies refined petroleum products and diesel to Australia.
Wong said South Korea was an important energy partner as Australia’s largest supplier of diesel and the third largest source of jet fuel.
“We trust you, you trust us,” Wong said, describing the need for close coordination and Australia’s commitment to South Korea as a reliable supplier of food, energy and other commodities.
South Korea is particularly vulnerable to conflict in Iran because it imports 70 percent of its crude oil from the Middle East, and more than 95 percent of that volume passes through the Strait of Hormuz.
It also receives 20 percent of liquefied natural gas from the region.
In Beijing on Wednesday, Wong said the Chinese government had agreed to cooperate with Australian businesses on jet fuel shipments.
“We believe this is an important step, but it is a first step,” Wong told reporters in Beijing, adding that the purpose of his trip was to press for Chinese cooperation “especially on the provision of liquid fuels.”
During his meeting with his Chinese counterpart Wang Yi, Wong said he “emphasized that China’s imports to Australia, including jet fuel, support Australia’s resource sector, which helps maintain the flow of commodities vital to bilateral trade relations.”
via Reuters
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