Japan is gearing up to bolster its energy security by supporting the development of pipelines that circumvent the Strait of Hormuz, a move prompted by vulnerabilities revealed during the ongoing US-Iran conflict. This initiative, part of a newly devised energy strategy, aims to enhance the country’s oil supply stability following its reliance on the Middle East for over 90% of its crude oil prior to the outbreak of war in February. According to documents released by Japan’s Cabinet Office, the government also plans to diversify oil procurement sources and provide assistance with shipping costs.
As stated by Prime Minister Sanae Takaichi, the landscape of energy supply has shifted significantly, leading to a reevaluation of existing government policies and corporate strategies. The new framework is set to be finalized by the end of the year. With Japanese refiners now seeking alternative imports from countries like the United States, the strategy will also leverage Japan’s strategic stockpiles to address current shortages.
In addition to supporting bypass pipelines, Japan intends to enhance the risk-financing capabilities of the Japan Organization for Metals and Energy Security (JOGMEC), which will facilitate investment in new infrastructure. The government will work to secure necessary insurance coverage for oil shipments and increase crude reserves to support domestic naphtha production.
