Gas stations, card companies butt heads over fees as prices at the pump surge
Published: 07 Apr. 2026, 19:02
Audio report: written by reporters, read by AI
![A signboard outside a gas station in Seoul displays the prices of gasoline, diesel and premium gasoline on April 7. [YONHAP]](https://koreajoongangdaily.joins.com/data/photo/2026/04/07/38adbb1a-8280-42ed-8ae0-77692564a021.jpg)
A signboard outside a gas station in Seoul displays the prices of gasoline, diesel and premium gasoline on April 7. [YONHAP]
The surge in global oil prices driven by the Iran war has gas station operators and credit card companies butting heads over transaction fees.
Fuel retailers argue that as oil prices rise, so too do credit card fees — squeezing margins and limiting their ability to lower prices for consumers. Card companies, on the other hand, say cutting fees is difficult, citing profitability concerns and the need to maintain fairness across industries.
The Korea Oil Distribution Association has asked the government and card issuers to temporarily lower the current 1.5 percent credit card fee during periods of high oil prices to between 0.8 percent and 1.2 percent, according to oil industry sources on Tuesday.
Under the proposal, fees would be adjusted in line with fuel prices — for example, capped at 1.2 percent when the price exceeds 1,800 won per liter ($4.55 per gallon) and lowered to 1 percent when it surpasses 2,000 won.
The association estimates that of the 58.1 trillion won in total sales recorded by roughly 10,600 gas stations nationwide last year, about 828 billion won went to credit card fees.
“Every 200 won increase in fuel prices raises card fees by about 3 won,” an industry source told the JoongAng Ilbo. “The burden on gas stations could rise by as much as 1 trillion won compared to last year.”
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At the heart of the dispute is the structure of fuel pricing, which includes taxes such as transportation, energy and environmental levies — amounting to 698 won per liter for gasoline and 436 won for diesel. Card fees can significantly eat into profit margins as they are calculated based on the sales price, which includes taxes.
However, card companies have resisted lowering fees, noting that gas stations already benefit from preferential rates applied to small- and medium-sized merchants under the current system.
According to the Financial Services Commission, merchants with annual sales below 300 million won are subject to minimum fees of 0.4 percent for credit cards and 0.15 percent for debit cards. For those with annual sales between 300 million won and 3 billion won, rates range from 1 percent to 1.45 percent for credit cards and 0.75 percent to 1.15 percent for debit cards.
“Given that preferential rates already apply to gas stations, it would be difficult to justify additional cuts from a fairness standpoint,” a credit card industry representative told the JoongAng Ilbo. “With overall fee revenue declining and net profits across card companies falling by nearly 9 percent last year, reducing fees would also negatively impact [our] profitability.”
![A bird flies near a vessel offloading LPG in Mumbai, India, on April 1 after transiting the Strait of Hormuz, through which Korea obtains most of its oil imports. The Iran war has disrupted energy supplies that normally pass through the strait. [REUTERS/YONHAP]](https://koreajoongangdaily.joins.com/data/photo/2026/04/07/ac6529c3-011f-4323-8ce7-b11cfbe31f5a.jpg)
A bird flies near a vessel offloading LPG in Mumbai, India, on April 1 after transiting the Strait of Hormuz, through which Korea obtains most of its oil imports. The Iran war has disrupted energy supplies that normally pass through the strait. [REUTERS/YONHAP]
In lieu of lowering fees, card companies have recently rolled out measures to soften the impact of rising oil costs on consumers at the request of financial authorities.
Nine domestic card issuers said they will offer full cashback on annual fees for new cards with benefits at gas stations until next month, along with additional discounts of up to 50 won per liter or 5 percent of fuel purchases.
“Rather than changing the fee system, we will focus on measures that consumers can directly feel,” the credit card industry source said.
This article was originally written in Korean and translated by a bilingual reporter with the help of generative AI tools. It was then edited by a native English-speaking editor. All AI-assisted translations are reviewed and refined by our newsroom.
BY KIM SEON-MI [[email protected]]
with the Korea JoongAng Daily
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