Korea Trade Review (무역학회지)

Korea Trade Research Association (한국무역학회)
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Performance and Prospects of Oil Hub Policy in Northeast Asia

동북아 오일허브 정책의 성과와 전망에 대한 연구

  • Lee, Choong Bae (Department of International Logistics, Chung-Ang University)
  • 이충배 (중앙대학교 국제물류학과)
  • Received : 2019.11.21
  • Accepted : 2019.12.18
  • Published : 2019.12.31
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Abstract

In the past two decades, due to the rapid fluctuations in the oil supply and demand in Northeast Asia as well as a surge in oil prices in the early 2000s, Korea has been developing the Northeast Asia Oil Hub project as a national project. This project was promoted based on the policy consideration that the nation's energy security and regional development can be promoted by establishing an oil hub in Northeast Asia that can eventually replace Singapore as East Asia's oil logistics hub. Following the construction of a large-scale oil storage facility in Yeosu in 2013, the main project in Ulsan has suffered many difficulties due to environmental changes such as the supply and demand of oil and political factors. The survey, which investigated the performance, problems, and prospects of the oil hub project, illustrates that scores of all sectors are of average level. In terms of performance and prospects, policies such as facility investment, law, and system improvement were determined to be rather high while operational areas such as value-added activities, profitability, and marketing activities were perceived as having more serious problems by respondents. In conclusion, despite the strong potential of Korea's oil hub based on its geographical location, facilities, and oil product capacity, there are problems related to policies, institutions, and investment. In the future, the oil hub business should be reviewed by considering environmental factors, and a drastic improvement plan for attracting foreign investors and oil traders should be established.

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