Japanese government plans to release oil reserves to rein in prices
Japanese Prime Minister Fumio Kishida said on Saturday that his government would consider releasing oil from its reserves in response to rising crude oil prices, the Kyodo news agency reported.
It would be the first time Japan has released oil reserves in an effort to drive down prices, although the country has previously drawn on its reserves to deal with natural disasters and geopolitical risks, Kyodo said.
The government of US President Joe Biden – which is seeing its approval ratings plummet as gasoline prices rise – has pressed some of the world’s largest economies to consider releasing oil from their strategic reserves to choke high energy prices.
The demands include asking China for the first time to consider releasing crude stockpiles.
“We are reviewing what we can do on the assumption that Japan will coordinate with the United States and other relevant countries,” Kishida told reporters, according to Kyodo.
Chief Cabinet Secretary Hirokazu Matsuno said on Thursday that Tokyo was closely monitoring the impact of rising oil prices on the world’s third-largest economy.
“While urging oil-producing countries to increase oil production, we will strive to stabilize energy markets by coordinating with major consuming countries and international organizations,” Matsuno said.
Resource-poor Japan gets the vast majority of its oil from the Middle East. The recent spike in oil prices and a weaker yen are driving up the cost of imports, dealing a double blow to a trade-dependent nation.
Kishida’s government on Friday unveiled a record $490 billion stimulus package that includes measures to counter rising oil prices. It plans to subsidize oil refiners in hopes of capping wholesale gasoline and fuel prices to relieve households and businesses from rising oil prices.
“What is important is to urge oil-producing countries to increase oil production,” Kishida said last month after talks with ministers. “We will organize concrete measures after confirming which industrial sectors are affected.”