Korean industries face supply chain alert as oil prices continue to rise
2026.03.31 09:41
According to industry sources on Monday, the price of polypropylene (PP), used in automotive parts, jumped about 35 percent from 6,800 yuan ($983.8) per ton a month ago to between 9,120–9,493 yuan per ton as of Friday.
ABS plastic also surged, from a monthly average of $1,227 per ton last month to an estimated $1,650–$1,750 per ton by the end of March, up as much as 42 percent.
Ethylene, widely used across industries, rose roughly 74 percent as of Friday compared with early March. Naptha, a key raw material, gained about 60 percent over the same period, while other naptha-based products, including xylene (60 percent) and butadiene (51 percent), also posted double-digit increases.
According to the Korea Price Research Center Corp., 12 out of 26 petrochemical products are not priced higher than before the conflict. The depreciation of the Korean won – from 1,439 to 1,498 per U.S. dollar during the survey period – also contributed to rising prices.
Concerns are mounting as even the Red Sea faces the risk of disruption.
“If petrochemical product prices rise together, increases in component costs are inevitable,” said an official from the automotive industry. “If the situation continues for a long time, adjustments to new car prices or optional features may become unavoidable.”
In the airline industry, five low-cost carriers – Jin Air Co., Air Busan Co., Eastar Jet Co., Air Premia Inc., and Aero K Airlines Co. – have decided to suspend operations on some routes starting in April. Other airlines, including Jeju Air Co., have also begun adjusting aircraft utilization rates, focusing on less profitable routes.
Route suspensions are mainly concentrated on short-haul routes to Japan and some routes to the Americas and the Pacific.
“As fuel costs now account for a much larger share of operating expenses, short-haul routes with intense fare discount competition are no longer sustainable,” said an airline industry official.
Airlines are also declaring emergency measures in response to rising costs.
Following T’way Air Co., full-service carrier Asiana Airlines Inc. recently announced emergency operations internally.
According to S&P Global, jet fuel prices in Asia reached 533.32 cents per gallon as of Friday, up 138 percent from 223.75 cents a month ago, just before the war.
Airlines said the burden is compounded because fuel surcharges lag behind rising costs. International fuel surcharges are calculated based on the average price of Singapore jet fuel from the 16th of the month before last to the 15th of the previous month, creating at least a one-month delay in reflecting sudden price spikes.
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