Japanese oil refiners, which source 95% of their oil from the Middle East, are calling on the Japanese government to invest in strategic oil reserves to ensure smooth operations for refiners and a supply of crude oil during a Middle East conflict.
Japanese refiners are in talks with the government to gain access to potential strategic reserves and oil stored in tanks leased to producing countries, unnamed sources familiar with the development told Bloomberg on Thursday.
On Tuesday, Japan’s Economy, Trade and Industry Minister Ryosei Akazawa said the government had no immediate plans to release crude oil from strategic reserves.
Japan is heavily dependent on Middle Eastern crude oil—it sources about 95% of its crude oil from the region, mostly from Saudi Arabia, Kuwait, the United Arab Emirates (UAE), and Qatar.
Of these supplies from the Middle East, about 70% typically reach Japan in tankers through the Strait of Hormuz.
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But the world’s most important oil transit hub has been effectively closed to tanker traffic since the beginning of the week after the war in the Middle East widened and ship owners stopped passing through the narrow passage while insurance clubs ended war risk coverage for ships in the waters around the Strait of Hormuz and the Persian Gulf and Gulf of Oman.
As an oil importer heavily dependent on crude supplies from the Middle East, Japan, a G-7 economy, is at high risk of crude supply delays.
However, Japan can rely on large enough reserves and is a member of the International Energy Agency (IEA), which requires member countries to have oil reserves equal to less than 90 days of net imports and is generally prepared to respond jointly to severe supply disruptions affecting the global oil market.
By the end of 2025, Japan had 254 days’ worth of oil reserves, including 146 days’ worth of consumption in national reserves, and more than 100 days’ worth of oil reserves with the private sector.
By Tsvetana Paraskova for Oilprice.com
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Japan (T) Middle East
