Japan Announces Largest Oil Reserve Release as Hormuz Crisis Deepens

Japan Announces Largest Oil Reserve Release as Hormuz Crisis Deepens

Japan is set to begin its largest-ever release of oil from strategic reserves, as the government moves to shield its economy from potential supply shocks linked to the escalating conflict involving the United States, Israel, and Iran.

Prime Minister Sanae Takaichi announced that Tokyo will start releasing state-owned crude reserves later this week, expanding earlier measures that tapped private-sector stockpiles. The decision reflects growing concern that instability in the Middle East could disrupt tanker traffic through the Strait of Hormuz, a vital corridor for global energy supplies.

Japan had already approved the release of oil equivalent to about 15 days of private-sector reserves. The latest move will significantly scale up that intervention, with a total of roughly 80 million barrels—about 45 days of domestic demand—to be made available to refiners. Officials say this is 1.8 times larger than the emergency release carried out after the 2011 Fukushima disaster.

The decision comes as global markets remain volatile due to fears that the ongoing conflict could choke off a major share of the world’s oil supply. The Strait of Hormuz handles a substantial portion of global crude exports, and any prolonged disruption could trigger severe price spikes and supply shortages worldwide.

Japan remains particularly vulnerable. The country imports over 90 percent of its crude oil from the Middle East, making it highly exposed to geopolitical shocks in the region. As of late last year, Japan held an estimated 470 million barrels in total reserves, equivalent to about 254 days of domestic consumption, providing a critical buffer against supply disruptions.

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In addition to drawing down reserves, Tokyo is coordinating closely with the International Energy Agency (IEA) and other partner countries, which have discussed coordinated releases to stabilize global oil markets amid the crisis.

Despite pressure from Donald Trump for Japan to take a more active security role in the region, including deploying maritime forces, Takaichi declined, citing constitutional limitations. Japan’s pacifist postwar constitution restricts overseas military operations, particularly in high-risk zones such as the Strait of Hormuz.

Takaichi emphasized that stability in the Middle East is critical not only for Japan but for the global economy, adding that Tokyo will continue to pursue diplomatic engagement with international partners to reduce tensions and ensure the safety of key shipping routes.

To cushion the domestic impact of rising energy costs, the Japanese government has also introduced fuel subsidies, aiming to cap gasoline prices at around ¥170 per litre (approximately $1.10). This follows a surge in retail fuel prices to a record ¥190.8 per litre, driven by global supply concerns.

Meanwhile, authorities are working to calm public anxiety after reports of panic buying, particularly of household essentials like toilet paper. The Ministry of Economy, Trade and Industry has urged consumers to avoid hoarding, warning that misinformation on social media could trigger unnecessary shortages.

Officials stressed that nearly all toilet paper sold in Japan is domestically produced using recycled materials, making it largely independent of Middle Eastern imports. Industry groups have also reassured the public that production capacity remains stable and can be ramped up if needed.

The government’s warning echoes past crises—including the COVID-19 pandemic and the 1973 oil shock—when panic buying disrupted supply chains despite adequate production levels.

While the record oil release is expected to provide short-term relief, analysts caution that sustained stability will depend on developments in the Middle East, particularly the security of the Strait of Hormuz and the trajectory of ongoing diplomatic efforts.

Japan Announces Largest Oil Reserve Release as Hormuz Crisis Deepens