Japan will release 5.8 million barrels of strategic petroleum reserves, keeping a close watch on the Iran crisis and stabilizing the market

To prevent energy shocks caused by the Iran crisis, the Japanese government has rolled out major measures to stabilize the market. Japan’s Ministry of Economy, Trade and Industry announced that it will launch a second phase of the national strategic reserves oil release plan. Through real, tangible supply inflows, the government aims to ensure the safety and stability of the energy supply chain and ease economic uncertainty in the market.

In response to the Iran crisis, Japan will release 5.8 million kiloliters of strategic reserves oil starting May 1

To ease international concerns about the energy market, Japan’s Ministry of Economy, Trade and Industry announced that it will release part of the national strategic reserves oil. This is the second wave of Japan’s government release actions in response to recent developments in the Middle East. The plan is expected to be carried out sequentially starting May 1. The amount of oil to be released in this round is about 5.8 million kiloliters, roughly equivalent to Japan’s domestic oil consumption demand for 20 days.

At a scale of up to 540 billion yen, demonstrating an energy security strategy

Against the backdrop that international tensions may disrupt the supply chain, the total value of Japan’s strategic reserves oil release in this initiative is estimated at about 540 billion yen (about $3.38 billion). This move is intended not only to make up for potential supply shortfalls, but also to stabilize market sentiment.

Following the first-phase policy, the two rounds combined will total more than a month’s worth of oil use

Before this action, the Japanese government announced on March 24 and launched the first phase of the strategic reserves oil release on March 26. In the face of steadily intensifying economic uncertainty, the Japanese government is closely monitoring international developments related to the Iran situation, and through two consecutive rounds of strategic oil releases, is actively working to prevent the energy crisis from expanding further.

(IMF warning: An Iran war could trigger global stagflation; oil supply could sharply drop by 13%)

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