Fire officials said the workers were painting the interior of the tanker at an STX Offshore & Shipbuilding plant in the southeastern city of Changwon and died almost instantly.
The bodies of the victims, in their 30s to 50s, have been recovered and salvage crews were trying to determine the cause of the accident.
"I heard a 'bang' and saw smoke coming from the tanker," a witness told Yonhap news agency.
The 74,000-tonne oil tanker was scheduled to be delivered to a Greek shipping company in October, according to Yonhap. South Korea is one of the world's largest shipbuilders.