The price of liquefied natural gas used by South Korean households and private firms will be reduced by an average 9 percent from the start of next month, the government said Tuesday.

The rate reduction reflects recent cuts in global oil prices, while the exact rate of the cut was decided at a policy coordination meeting with the ruling Saenuri Party, according to the Ministry of Trade, Industry and Energy.

"The price of LNG supplied by the Korea Gas Corp. has been cut by 20.7 percent this year, and the additional reduction, effective as of Jan. 1, will further contribute to improving the livelihood of the people," it said in a press release.

The latest price cut will allow each of the country's 16.57 million households that use LNG to save an average 3,435 won ($2.94) per month.

The price of LNG is adjusted every two months to reflect any change greater than 3 percent in the price of supplies.

The price of LNG is closely linked to that of oil as LNG is mostly produced by refining crude oil.

The average price of Dubai crude, which accounts for some 80 percent of the country's total oil imports, came to $41.60 per barrel in November, down 46 percent from $77.10 per barrel in the same month last year, the ministry said earlier. (Yonhap)