South Korea’s largest conglomerate Samsung Group said Wednesday it plans to draw up energy-saving measures this month as high oil prices are expected to hurt its profitability.
“The global economic downturn and continuation of high oil prices are weighing on the Korean economy and the costs of using energy is rising,” the group said in a statement.
High oil prices are one of the biggest threats to the Korean economy, which relies almost entirely on imports for its oil needs.
South Korea is the world’s fifth-largest crude buyer.
Prices of Dubai crude, South Korea’s benchmark, topped $120 per barrel in recent trading amid concerns that Washington-led international sanctions on Iran due to its suspected nuclear programs may tighten oil supply.
Samsung said it will compile the necessary data and study specific impacts from high oil prices on its business activities by mid-March, adding it will draw up measures to boost energy efficiency by the end of this month.
According to Samsung Group, its energy costs may grow about 20 percent on-year in 2012 if the current trend of high oil prices continues.
Samsung Economic Research Institute said if prices of Dubai crude stay at a yearly average of $150 per barrel, the growth of the local economy will likely fall 1.9 percentage points while consumer prices will rise 1.3 percentage points.
The Korean economy grew 0.4 percent on-quarter in the fourth quarter, cooling from a 0.8 percent expansion in the third quarter.
Asia’s fourth-largest economy is expected to grow 3.7 percent this year, according to the central bank.
(Yonhap News)
