A gas station in Incheon on Sunday (Yonhap) The number of gas stations in South Korea has been steadily shrinking, with nearly 1,000 shutting down over the past 6 1/2 years, according to government data.
Data from Opinet, a crude oil price information platform operated by the state-run Korea National Oil Corp., shows that the country had 11,499 gas stations in 2019. That figure fell 8.4 percent to 10,528 as of the end of June this year.
The market peaked in 2010, when 13,004 stations operated nationwide. However, it has been in steady decline since then. It is projected that the total will slip below 10,000 within three to four years.
At the root of the falling trend is a drop in profitability.
Gas station operating profit margins, which stood at 17.8 percent in 1991, had declined to 11.5 percent by 2001 and plummeted to just 1.7 percent as of 2023.
Oil industry insiders point to the growing government-run fuel stations operated by the Korea National Oil Corp., which offer fuel at prices 40 to 50 won per liter lower than those of private competitors.
Pressured to match those prices, many privately owned stations have seen their margins collapse.
The number of KNOC-operated stations rose from 1,182 in 2019 to 1,290 as of May this year, with their market share surpassing 20 percent.
Adding to the pressure is the rapid rise of eco-friendly vehicles, including electric, hydrogen, and hybrid models, which are cutting into gasoline demand.
Environmentally friendly vehicles now account for 10.4 percent of the nation’s total vehicles.
ssh@heraldcorp.com