South Korea Approves 26.2 Trillion Won Budget for Middle East Fallout

South Korea's government approved a supplementary budget of 26.2 trillion won on Tuesday to mitigate the economic fallout from escalating tensions in the Middle East, where a U.S.-Israeli military campaign against Iran has driven up global oil prices and disrupted supply chains. The measure, equivalent to about 17 billion U.S. dollars, targets rising fuel costs, support for vulnerable households and businesses, and efforts to stabilize key industries in the energy-import-dependent nation.

The Cabinet endorsed the proposal during a meeting in Seoul, where President Lee Jae-myung emphasized the need for swift action amid the crisis. The budget allocates 10.1 trillion won to address high oil prices, including subsidies for refiners facing losses from a nationwide fuel price cap introduced this month for the first time in nearly three decades. An additional 4.8 trillion won will fund consumer vouchers ranging from 100,000 won to 600,000 won per person for about 70 percent of the population, excluding the top 30 percent by income. Payments will vary based on income levels, regional factors and population decline in certain areas, with the largest amounts going to low-income...