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Middle East War Prolongation Fears Rattle Construction Industry Amid Surging Oil Prices
Middle East War Drives Oil Price Surge, Alarming Construction Sector
The prolonged Middle East war is causing a significant increase in international oil prices, putting the Incheon construction industry on high alert. Rising oil prices directly lead to increased costs for equipment operation and material transportation, thereby escalating overall construction production expenses. On March 13, Brent crude, the international oil benchmark, closed at $103.14 per barrel, marking approximately a 42% increase from its closing price of $72.48 per barrel on February 27, just before the U.S. initiated conflict with Iran.
Impact of Rising Oil Prices on Construction Production Costs
According to an analysis by the Construction and Economy Research Institute of Korea (CERIK), a 50% increase in oil prices is projected to raise construction production costs by 1.06%. Specifically, civil engineering projects, such as road construction, are expected to see a 2.93% increase in production costs, making them the most heavily impacted segment of the construction sector. Diesel is directly used as fuel for heavy equipment on construction sites, and petroleum is essential throughout the production process of core construction materials like ready-mixed concrete and asphalt concrete, ensuring a significant ripple effect. CERIK suggested implementing customized unit price management measures and support policies to prepare for a prolonged situation.
Incheon Construction Industry's Concerns and Responses
Incheon is home to 4,111 construction companies, with over 100 construction starts consistently occurring each month. Active construction directly correlates with fuel consumption, raising concerns that the impact of rising oil prices will be fully borne by Incheon's construction industry. An industry official stated that the rising costs of foreign materials and oil are creating significant burdens on sites. They added that while the situation is manageable for now, it could become severe if the conflict prolongs, and they are currently considering pre-contracting with foreign suppliers at current prices.
*Source: v.daum.net (2026-03-16)*
