As the conflict between the US, Israel, and Iran continues to escalate and the Strait of Hormuz remains blockaded, the Petroleum Association of Japan is seeking new sources of crude oil supply. The association's president, Shunichi Kito, indicated that the North American market, especially Ecuador, Colombia, and Mexico, has emerged as a potential supply option.
Supply Disruptions and Alternatives
Kito pointed out that the ongoing closure of the Strait of Hormuz has caused oil prices to surge above $100 per barrel, and left tankers stranded in the Gulf region, unable to reach their destinations promptly. To address this supply gap, global oil buyers, including Japan, are looking for alternative sources of crude, particularly considering Japan's heavy reliance on Middle Eastern oil.
Investment Diversification and Cooperation
Kito suggested that Japan should invest in oil production in Alaska to circumvent the current supply bottlenecks. Meanwhile, he also mentioned that Japan should consider increasing its reserves of American oil to achieve supply diversification. During a recent visit to the United States, Japanese Prime Minister Sanae Takaichi also stated that the two countries have agreed to increase US energy production.
Strategic Reserves and Response Measures
Currently, about 90% of Japan's oil is imported from the Middle East. Kito stated that as the current situation continues to worsen, the government should consider further releasing strategic oil reserves. Japan has already begun tapping into its oil reserves last week to alleviate the supply crisis.
