Key facts
- Japanese refiners have enough crude oil to last through November.
- The Petroleum Association of Japan (PAJ) stated that supplies from Saudi Arabia have not ceased entirely.
- Japan imports over 90% of its crude oil from the Middle East, with about 70% typically arriving via the Strait of Hormuz.
- Japan is sourcing crude from alternative locations like Canada, Azerbaijan, and Africa.
- Japan participated in a global effort to release 400 million barrels of crude and oil products from strategic reserves.
Japanese refiners have secured sufficient crude oil supplies to meet their needs through November, according to the Petroleum Association of Japan (PAJ). This assurance comes amid ongoing supply chain disruptions originating from the Middle East.
The PAJ president, Shunichi Kito, stated on Friday that despite the temporary shutdown of Saudi Arabia's East-West oil pipeline following recent attacks and disruptions at the Red Sea port of Yanbu, shipments from Saudi Arabia have not completely halted. He explained that oil is sometimes shipped through the Strait of Hormuz at Saudi Arabia's own risk before being transferred to buyers outside the Gulf.
Japan, which relies heavily on Middle Eastern crude, with over 90% of its imports originating from the region and approximately 70% typically arriving via the Strait of Hormuz, has been actively seeking alternative sources. These include cargoes from Canada, Azerbaijan, and Africa. Additionally, Japan has released crude oil from its strategic reserves as part of a coordinated global effort led by the International Energy Agency (IEA) to release 400 million barrels of crude and oil products.
However, the economic cost of sourcing crude from distant locations to compensate for lost deliveries through the Strait of Hormuz is significant, with rising oil import bills impacting industrial and economic activity.