Page 13 - AsiaElec Week 07 2022

AsiaElec FUELS AsiaElec

Japan considering

moves to keep fuel

prices under control

JAPAN THE Japanese government is considering new to increase output to help keep prices under
measures to prevent rising fuel prices across the control.
country from getting out of control. Questions about Tokyo having approached
In reports out of Tokyo, Minister of Economy, Tehran to request Iran also increase output
Trade and Industry (METI), Koichi Hagiuda, were met with a curt “No” by Hagiuda, although
has indicated a desire to take steps to limit the given Japanese moves in previous oil crises, such
impact felt by the general population as oil prices moves cannot be completely discounted.
remain high and in some sectors are starting to On the surface at least, Japan remains fully
show signs of affecting economic activities. supportive of ongoing US sanctions on Iran,
Having only been in the post since last Octo- although investors in Tokyo and around the
ber, Hagiuda is seen as more in touch with nor- world are keeping an eye on the latest round of
mal Japanese than his predecessor, saying “We Washington-Tehran nuclear talks.
will consider what the most effective measures Coming at a time much of the world is
are from the perspective of minimising the focused on the Ukraine-Russia border region
impact on people’s lives and economic activities.” and knock-on effects any conflict could have on
With crude oil prices having hit seven year oil prices, the talks mediated by the EU “have
highs, Hagiuda did not go into detail though, reached an urgent point,” according to White
which has led to some speculation as to what is House spokeswoman Jen Psaki.
being considered by the ruling Liberal Demo- Psaki went on to stress that if a deal were not
cratic Party. reached soon “Iran’s ongoing nuclear advances
At a press conference, the Minister did go on will make it impossible for us to return to the
to say, however, that METI was “at the moment” Joint Comprehensive Plan of Action” (JCPOA).
not looking to raise the current limit on subsidies Moves in the right direction would, however,
already in place or even considering freeing up a lead to increased Iranian crude hitting gobal sup-
‘trigger clause’ on gasoline. ply chains in a matter of weeks, helping to reduce
Japan’s subsidy on gasoline was introduced the effects felt by the current supply squeeze.
earlier in the year but has already hit a ceiling of And, according to Rane Risk Intelligence
50 yen (US$ 0.4) per litre with the government analysts “The U.S. is accepting that it needs to
hesitant to raise this figure higher. go further this time to rebuild a sense of Iranian
The trigger clause in question was introduced trust and moreover to accept the political real-
in 2010, to help reduce gasoline and diesel taxes ities that have come with (Iranian) President
when prices move past 160 yen (US$ 1.38) per Raisi’s election” with New York based political
litre for three consecutive months, although risk agency Eurasia Group also addressing the
in the wake of the March 11, 2011 Fukushima elephant in geopolitical circles by adding that
earthquake and tsunami in the north of Japan, “Washington is willing to accept a deal with
was frozen by METI as a means of raising funds substantially weaker nuclear constraints on Iran
for rebuilding. compared with the 2015 agreement, in terms of
In addition to domestic efforts to allevi- breakout time, and to offer Iran sanctions relief
ate financial pain felt by high crude prices, it or assurances beyond the scope of JCPOA …
is understood Japan continues to pressure oil Washington’s argument is essentially that some
producers in the Middle East, particularly in limits are better than none.” ™
the United Arab Emirates, and also in the US,

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