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Japan’s January oil imports highlight

dominance of GCC nations

JAPAN WHILE Japan is heavily reliant on the Middle Imports from Saudi dealers made up the bulk
Eastern for crude oil imports, many were sur- of Japanese GCC purchases for the month, with
Some 95% of Japanese prised to see that almost 95% of all crude oil 43.9% coming in from the Kingdom.
oil imports came from imports ordered by Tokyo in January arrived Equivalent to 37.095mn barrels, the Saudi
the Gulf nations. from Arab nations. crude led the second ranked GCC exporter to
Officially topping out at 94.4% of imports for Tokyo by over 8mn barrels; the UAE shipping a
the first month of the year, crude imported from total of 28.854mn barrels to the Far East.
the five Cooperation Council for the Arab States Numbers aside, ignored by many, but of great
of the Gulf (GCC) countries of Kuwait, Oman, significance in Japan was the fact that imports
Qatar, Saudi Arabia and the UAE levelled out at from Saudi Arabia in January had actually
just over 79.72mn barrels for the month. increased against figures posted in December.
In total the world’s third-largest economy Many sources in the Japanese capital
imported 84.423mn barrels, according to sta- expected the start of 2023 to be a turning point,
tistics released by Japan’s Agency for Natural marking the start of a gradual decline in GCC
Resources and Energy at the Ministry of Econ- crude imports, beginning with those from Saudi
omy, Trade and Industry (METI) in Tokyo. Arabia.
Oil makes up around a third of Japan’s cur- Kuwait accounted for an addition 8.448mn
rent energy mix at present, but this is a figure barrels with Qatar adding a further 3.875mn and
expected to drop dramatically in the coming just under 1mn coming in from Oman.
years as Tokyo moves away from fossil fuels and Of note, Japanese government data also
towards net-zero goals whilst also bringing a included the import of 450,000 barrels from
number of its long-mothballed nuclear reactors the 5,770-square kilometre neutral zone in
back online. the border area between Saudi and Kuwaiti
The latest figures are a surprise to some territory.
Japan-based analysts, however, especially after Tacitly neutral since 1922, in many ways the
extensive efforts by authorities in the country to region is self-operating, but in terms of energy
diversify its crude supply base in recent months. exports last December saw an agreement
Related to the diversification efforts, albeit between Saudi Aramco and the Kuwait Gulf Oil
still a number seen as much too low to make Company aimed at the co-development of the
much of a difference was a resumption of crude Durra gas field. It is thought the site will one day
coming in from Russia, with 0.9% of the total produce up to 84,000 barrels per day (bpd) of
ordered from Moscow. LNG. Japanese interests from afar in the Neutral
This amounted to a shade over 747,000 Zone have been long-standing, dating back to
barrels. the oil shock of the early 1970s, albeit discreet
In recent months, much has been made of for the most part.
Japan politely manoeuvering its way around The United States along with Central and
US and EU-led sanctions on Russian exports, South America combined to supply a fur-
although to appease Washington, Tokyo does ther 4.2% of Japan’s January inflow, with lesser
still opt to boycott Iranian crude exports accord- amounts also coming from fellow Asian nations
ing to officials. Malaysia and Indonesia. ™

Week 11 17•March•2023 www. NEWSBASE .com P7