South Korea Proposes $17.3 Billion War Relief Budget to Counter Energy Crisis

South Korea proposed a 26.2 trillion won supplementary budget to mitigate economic fallout from the war.

“ANI |Updated:Apr 02, 2026 13:53 IST Seoul [South Korea], April 2 (ANI): South Korean President Lee Jae Myung on Thursday called on the country's National Assembly to quickly pass a KRW 26”

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The package allocates 10.1 trillion won to counter higher oil prices and 2.8 trillion won to support low-income households.

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At the core is a 5 trillion won provision to fund a nationwide fuel price cap.

Lee described the situation as a wartime-level crisis and the spending will avoid new debt issuance.

The budget faces opposition from the People Power Party.

The budget includes direct transfers to 35.8 million citizens targeting the lower 70% of income groups.

Payments will range from 100,000 to 600,000 won per person depending on income and region.

Al-Monitor

This is designed to protect vulnerable populations while sustaining consumption.

South Korea began scrutinizing potential supply chain disruptions for critical goods.

“The President of South Korea called for urgent measures to counter the rise in oil prices”

Anadolu Ajansı

Prime Minister Kim Min-seok called the situation a complex crisis.

The impact could expand far beyond energy prices into broader sectors.

The budget highlights how Middle East conflicts cascade into Asian economies.

South Korea is the world's fourth-largest oil importer and Asia's fourth-largest economy.

chinadailyhk

The funding underscores Lee's commitment to expansionary fiscal policy.

The war-induced shockwaves extended beyond energy markets.

“South Korea on Tuesday proposed an extra government budget totaling $17”

CNN Al-Iqtisadiyya

Asian credit derivatives surged, and central banks signaled caution.

CNN Al-Iqtisadiyya

Sustained Gulf insecurity could depress oil demand by 1.6 million barrels per day in Asia.