Oil & Gas

Japan Says It Will Take Time To Cut Use of Russian Oil

 

Japan’s Prime Minister, Fumio Kishida, on Monday said Tokyo will take some time to wean itself off Russia oil imports following its decision on a ban along with other group of seven (G7) nations in the wake of Moscow’s special operations in Ukraine.

The G7 nations vowed on Sunday to ban Russia oil imports “in a timely and orderly fashion” to put pressure on Russian President Vladimir Putin, although resource-poor Japan depends heavily on Russian fuel.

“For a country heavily dependent on energy imports, it’s a very difficult decision. But G7 coordination is most important at a time like now,” Kishida told reporters, repeating comments he made at the G7 meeting.

“As for the timing of the reduction or stoppage of (Russian) oil imports, we will consider it while gauging the actual situation,” he said. “We will take our time to take steps towards a phase-out.” He did not elaborate.

There have been no ships loading Russian oil for Japan since mid-April, according to Refinitiv data. About 1.9 million barrels were exported from Russia to Japan in April, 33% down from the same month a year ago.

 

ALSO SEE:  Asian Markets Slip as Ukraine, China Slowdown Woes Weigh

 

 

Oil Ban Underlines Policy Turn

The Ukraine crisis has highlighted Japan’s energy dependence on Russia even as Tokyo has acted swiftly and in tandem with the G7 in instituting sanctions.

The latest ban underlines a turn in Japan’s policy. Japan has said it would be difficult to immediately cut off Russian oil imports, which accounted for about 33 million barrels of Japan’s overall oil imports, or 4%, for 2021.

It has already said it will ban Russian coal imports in stages, leaving just liquefied natural gas (LNG). Japan is in a particularly tough spot since it shut down the bulk of its nuclear reactors following the 2011 Fukushima nuclear disaster.

Russia was Japan’s fifth-biggest supplier of crude oil and LNG last year.

The Japanese government and companies own stakes in oil and LNG projects in Russia, including two on Sakhalin Island from which partners Exxon Mobil and Shell have announced they will exit.

Still, Japan’s biggest oil refiner, Eneos Holdings, has already stopped buying Russian crude, saying it would get supplies from the Middle East.

On Friday, trading firm Marubeni Corp said it wanted to withdraw from the Sakhalin-1 oil project but was keeping its stake in line with government policy.

Kishida said on Monday there was no change to the government’s policy of keeping business interests in the various Russian energy assets.

 

  • Reuters with additional editing by Jim Pollard

 

 

ALSO READ:

 

Japan to Restart Nuclear Reactors to Avoid Russian Gas

 

Some China Refineries Buy Russian Oil Very Cheaply – FT

 

Does US Warning to India Point to More Russian Oil Restrictions?

 

Buying Russian Oil Not in India’s Interest, Biden Tells Modi

 

 

 

Jim Pollard

Jim Pollard is an Australian journalist based in Thailand since 1999. He worked for News Ltd papers in Sydney, Perth, London and Melbourne before travelling through SE Asia in the late 90s. He was a senior editor at The Nation for 17+ years and has a family in Bangkok.

Recent Posts

Yellen: China’s Green Energy Push a Threat to Global Jobs – AP

US Treasury Secretary Janet Yellen has accused China of ‘distorting prices’ with its increased green…

42 mins ago

Yen Fears Drag on Nikkei, Hang Seng Lifted by Policy Bets

Japan’s plunging currency and the threat of BoJ intervention sent Tokyo’s soaraway benchmark downwards

2 hours ago

China Keen For Tech Innovation to Drive Economic Growth

China will make tech innovation a focus of economic growth and aims to help drive…

2 hours ago

Investors Suspect Beijing Behind Controlled Yuan Decline

The currencies of China's trading partners have weakened faster than the yuan recently, eroding the…

19 hours ago

Shimao Bondholders Group to Vote Against Debt Revamp Plan

The creditors’ opposition to the proposal could be a major problem for the ailing property…

20 hours ago

China’s Country Garden ‘Hires Kroll For Liquidation Assessment’

Sources say China's biggest developer, which went into default in October with debts of $190…

23 hours ago