Japan has begun releasing 30 days’ worth of oil from state reserves to cushion the impact of the West Asia conflict on its economy today, as concerns over supply mount and oil prices soar. The move comes after the country started drawing down 15 days’ worth of oil from private-sector stockpiles last Monday. According to local media, the Japanese government plans to sell a total of about 8.5 million kilolitres of oil from 11 storage bases across the country. Japan will also begin to tap joint oil reserves held in the country by three West Asian nations, including the United Arab Emirates, with five days’ worth to be released by next Tuesday for supply to oil wholesalers.

 

Japan relies on the West Asia for more than 90 per cent of its crude oil imports, leaving it highly vulnerable to the effective closure of the Strait of Hormuz following the outbreak of the US-ISRAEL and IRAN  conflict in late February. The disruption has driven sharp rises in both crude oil and retail gasoline prices all over the world.