Japan to Compensate Oil Importers for High Shipping Costs
Japan to Compensate Oil Importers for High Shipping Costs What I Cover Tsvetana Paraskova is an energy and commodities journalist who has contributed to Oilprice.com for nearly a decade, covering global energy markets, commodities,… The Japanese government on Tuesday approved three bills to boost diversification of oil supplies and energy security, including grants to compensate Japan’s oil importers for the high shipping costs to procure supply from alternative sources.
The bills will now be introduced for debate at the Japanese Parliament.
The legislation is aimed at improving “supply security by diversifying sources of crude oil and other fossil fuels and reducing related risks,” Japan’s Industry Minister Ryosei Akazawa told a press conference on Tuesday, as carried byReuters.
Last week, Akazawasaidat a press conference that “these bills are intended to promote the diversification of crude oil procurement through measures such as support for additional costs, including increased transportation expenses arising from changes in crude oil transportation routes, ensuring that necessary insurance mechanisms are in place for the stable transport of crude oil and other petroleum-related resources, and support for the development of alternative transportation routes, including pipelines.” Japan’s oilimport billhas soared to record highs following the closure of the Strait of Hormuz – the G7 economy’s key import source before the war – the spike in crude oil prices, and skyrocketing freight and insurance costs.
Since the war in the Middle East began, Japan has scrambled to secure crude oil supply from alternative sources as its dependence on crude from the Middle East passing through the Strait of Hormuz was more than 90% of all crude imports.
Of the Middle Eastern supplies, about 70% typically arrived in Japan on tankers traveling through the Strait of Hormuz.
The G-7 economy has also moved torelease crudefrom its strategic reserves as part of an IEA-coordinated global effort to release 400 million barrels of crude and oil products.
Japan is now buying cargoes from as far asCanada, Azerbaijan, and Africa to offset the supply that continues to be trapped in the Persian Gulf.
However, the economic cost of sourcing crude oil supply from faraway places to offset the major loss of deliveries from the Strait of Hormuz is high, withsoaring oil import billsweighing on industrial and economic activity.
Saudi Arabia Shoots Down Houthi Missiles as Regional Conflict Escalates Saudi Arabia Shoots Down Houthi Missiles as Regional Conflict Escalates What I Cover Tsvetana Paraskova is an energy and commodities journalist who has contributed to Oilprice.com for nearly a decade, covering global energy markets, commodities,… Saudi Arabia Cuts Europe Off From October Crude as Gulf Exports Surge Saudi Arabia Discovers 110 Million Tonnes of Uranium-Bearing Ore Strait of Hormuz Shipping Traffic Falls Further as Saudi Oil Flows Rise Macron Calls for Another Emergency Oil.
| Product | Price | Change |
|---|---|---|
| Brent Crude | $102.14/bbl | +0.34% |
| WTI Crude | $96.90/bbl | +0.21% |
| EN590 Diesel | $846/MT | +0.18% |
| Jet Fuel A-1 | $1090/MT | +0.55% |
| Mazut M100 | $450/MT | -0.15% |
| Bitumen 60/70 | $470/MT | +0.08% |
| Sulphur Gran 99.5% | $470/MT | -0.44% |
| Urea 46% Gran | $650/MT | +1.12% |
| NPK 16-16-16 | $460/MT | -0.28% |
| Nat Gas TTF | $15.42/MMBtu | +0.92% |
Comments
Post a Comment