The government launched Friday an audit into the Korea National Oil Corp. over the company's failure to exercise priority purchase rights of foreign-owned crude oil stored in South Korea, resulting in an outflow of 900,000 barrels of stockpile, according to officials.

A petroleum tanker truck is seen at the entrance of the Korea Oil Pipeline Corp.’s Gyeongin branch storage facility in Goyang, Gyeonggi Province, in this file photo. (Yonhap)
A petroleum tanker truck is seen at the entrance of the Korea Oil Pipeline Corp.’s Gyeongin branch storage facility in Goyang, Gyeonggi Province, in this file photo. (Yonhap)

The 900,000 barrels of international joint oil stockpile, which had been kept at Korea's oil reserve in the southeastern city of Ulsan by an unidentified foreign company, was sold overseas recently as KNOC did not exercise the priority rights, according to the Ministry of Trade, Industry and Resources.

Under the international joint crude oil stockpiling program, KNOC had priority in purchasing the stockpile as it had leased its domestic facility to the foreign firm for oil storage.

The ministry reportedly found out the incident as it was pushing to exercise the priority purchase rights of international joint crude stockpiles in Korea after raising the alert over a possible oil crisis by a notch to Level 2 earlier this week amid the persisting Middle East crisis.

"Currently, it is impossible to secure back the 900,000 barrels already sold overseas," a ministry official said. (Yonhap)