Japan Refiners Weigh Alternative To Handle Oil Supply Disruptions - Insight Trending

Japan Refiners Weigh Alternative To Handle Oil Supply Disruptions

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Japan Refiners Weigh Alternative To Handle Oil Supply Disruptions

Japanese oil refiners have started weighing alternative to handle disruption to crude supply sources that would not need to transit through the Strait of Hormuz, including from the Red Sea side in Saudi Arabia, West Africa and the US, amid mounting tensions in the region, the head of the Japan Petroleum Association (PAJ) said on Friday.

“Refiners are making various simulations in case of emergency in the Middle East,” Takashi Tsukioka, president of the PAJ, told a news conference.

Japan heavily relies on crude imports from the Middle East, most of which transit through the Strait of Hormuz.PAJ and the refiners are also looking at how they can release strategic petroleum reserves most effectively in the event of an emergency, Tsukioka said at a press conference in Tokyo.

"Every [PAJ] member refiner is in consensus for considering releasing the stock where it will be most effective, or from where it can be released swiftly," Tsukioka said.

"Next we will likely consult the Ministry of Economy, Trade and Industry, especially the Japan Oil, Gas and Metals National Corporation, on detailed procedures, but we have not reached that point as yet," he added.

The measures include purchasing spot oil from other areas such as West Africa or the United States, as well as the use of national reserves, he said.

Two oil tankers, were attacked last week just outside the Strait of Hormuz, with the US, the UK and Saudi Arabia blaming Iran, one operated by a Japanese shipping company, raising concerns about a confrontation and driving up oil prices, despite Tehran denying involvement in the explosions at sea.

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