Japan's Strategic Oil Reserve Release Amid Hormuz Uncertainty

Japan may release 20 more days' worth of oil reserves in May due to uncertainties over the Strait of Hormuz reopening. Japan relies heavily on Middle East oil and opened its reserves in March. Despite US-Iran ceasefire talks, Japan is preparing strategies to avert potential oil supply disruptions.

In light of the ongoing uncertainties around the reopening of the Strait of Hormuz, Japan is contemplating a further release of oil reserves in May, reported Kyodo on Thursday. This decision stems from the country's heavy reliance on Middle Eastern oil, accounting for 95% of its supply.

Since mid-March, Japan began tapping into its stockpiles and has coordinated with international partners, freeing up 50 days' worth of oil consumption. With the US and Iran recently agreeing to a temporary ceasefire, Japan still prepares for contingency due to the strait's partial closure.

Japanese refineries have reduced their operational rates to alleviate the crisis. The Ministry of Economy, Trade and Industry is exploring sourcing oil from outside the Middle East and has introduced subsidies and alternative energy generation to manage supply chain challenges.

(With inputs from agencies.)