The 146,000-tonne tanker was struck while at anchor off Daesan port in the Taean region.
There were no human casualties in the accident, but the extent of its potential damage to communities or wildlife in the area was not immediately clear, another ministry official said.
The maritime ministry said the Hebei Spirit had already leaked about 10,800 tonnes of crude oil into the sea near one of the country’s most scenic coastlines.
Technical managers of the Hebei Spirit issued a statement later in the day, confirming the collision with a local crane barge owned by Samsung Heavy Industries.
The very large crude carrier, or VLCC, was about three kilometres from the port, waiting to unload its cargo of some 260,000 tonnes of crude oil from the Middle East.
The port is about 110km southwest of Seoul.
Wind and waves of up to four metres have hampered efforts to contain the spill, which the official said could reach the coast in less than 48 hours.
Popular for beaches
The Taean region’s coast is popular for its beaches and is home to a national maritime park. It is also an important refuelling stop for migratory birds.
The maritime ministry’s Lee said the oil was unlikely to spread north to the major port of Incheon, which serves the capital.
Workers have been trying to shift the oil to tanks that were not damaged in the collision, he said.
Industry sources and the maritime ministry said the crude was intended for South Korean refiner, Hyundai Oilbank.