Is the Japanese market waiting for Iranian oil?

According to the exclusive report of Energy Press, Russia’s military attack on Ukraine in February 2022 had many repercussions around the world and caused fundamental changes in international relations. The attack affected security dynamics not only in Europe, but also in Asia, forcing countries such as Japan to reassess their relations with Russia. Especially the impact of this situation on energy policies and regional strategies of Japan dependent on energy import is very important.
Relations between Japan and Russia have often been tense. After the Russo-Japanese War in the early 20th century, ongoing disputes over the ownership of the islands, especially in northeastern Hokkaido, became one of the defining factors in bilateral relations. These islands, which are known as “Northern Lands” in Japan, are called “Southern Kuril Islands” in Russia. Improving relations with Russia was one of the foreign policy priorities of the government of former Japanese Prime Minister Shinzo Abe. One of the reasons for this approach is that Japan intends to take back some of the disputed territories known as the Northern Territories in Japan by following a soft foreign policy strategy with Russia and signing a peace treaty.
Ukraine war and Japan’s energy security
The start of the Russia-Ukraine war in 2022 caused the Japanese people’s view of Russia to fundamentally change. The results of the official survey in 2022 showed that the Japanese people’s opinion of Russia was recorded at the most negative level. Therefore, in response to the war in Ukraine, Japanese society largely supported the sanctions against Russia. Prime Minister Fumio Kishida, who is not as committed to improving relations with Russia and signing a peace treaty as Abe, sees Russia’s attack on Ukraine as a direct challenge to Japan and says things like “Ukraine today can become East Asia tomorrow.”
Russia’s attack on Ukraine, an important supplier of energy imports, has led to some changes in Japan’s energy policies. Before the Ukraine war, Russia accounted for 3.6% of Japan’s oil imports, 8.8% of liquefied natural gas (LNG) imports, and 11% of coal imports. As a result of Russia’s attacks on Ukraine, one of the largest producers and exporters of oil and gas in the world, the price of oil and gas increased significantly, and this has caused many problems, especially for countries dependent on energy imports such as Japan. In April 2022, two months after Russia’s invasion of Ukraine, Japan announced its intention to gradually reduce imports of Russian coal and oil, and in December, Japan and the Group of 7 agreed to impose a price cap on Russian crude oil. . By the end of 2022, Japan has reduced the import of Russian oil and coal by 56% and 41%, respectively, compared to the previous year.
The energy crisis has led to energy security concerns on a global scale and has led many countries to strengthen their renewable energy policies to increase local electricity production. On the other hand, Tokyo has decided to continue importing Russian oil and gas from the Sakhalin projects, where Japanese companies have made large investments and which supplies approximately 9% of LNG. In this context, unlike the United States and many European countries, Japan largely did not consider the Ukraine war as an opportunity to reduce dependence on energy imports and accelerate the transition to domestic renewable energy. One of the main reasons for this is Japan’s concern that a widespread transition to renewable energy could increase the country’s commercial dependence on China as the dominant force in renewable energy markets.
As a result, the Russo-Ukraine war led to significant changes in Japan’s foreign policy and energy strategy. This attack caused Japan to strengthen its relations with NATO and emphasize the connection between the security of Asia-Pacific and Europe-Atlantic more. Japan, which has historically had complicated relations with Russia, changed its energy policies by imposing severe sanctions against Moscow in the context of the Ukraine crisis. Japan’s decision to significantly reduce Russia’s share of energy imports has increased Tokyo’s efforts to ensure energy security. However, unlike many other countries, rather than accelerating the transition to renewable energy, Japan is looking to continue using fossil fuels in the long term.