Japan and Saudi Arabia Establish New Oil Route Bypassing Hormuz 0 20

New Route for Japanese Oil

Japan and Saudi Arabia have reached an important agreement to create a new route for oil transportation. This route will allow for bypassing the critically significant Strait of Hormuz, significantly enhancing supply security. The news came after a phone call between Japanese Prime Minister Sanae Takachi and Saudi Crown Prince Mohammed bin Salman Al Saud, as reported by Kyodo.

Tokyo's Energy Security Strategy

Earlier, Japanese authorities expressed confidence in their ability to fully meet domestic oil needs at least until the end of the current year. This ambitious plan relies on two key elements: the active use of alternative logistics chains and the partial implementation of state oil reserves. Tokyo aims to diversify its energy sources as much as possible to minimize risks.

Diversification of Suppliers

New supply routes are being considered from the United Arab Emirates through the port of Fujairah, as well as from Saudi Arabia through the port of Yanbu al-Bahr. It is estimated that each of these countries can provide about half of the necessary raw materials for Japan. Additionally, the United States has expressed readiness to increase oil exports to Japan fourfold compared to last year's figures, primarily from terminals in Texas. Additional volumes are also expected from Azerbaijan, further expanding the supply geography.

Use of Strategic Reserves

Since March 16, oil from state reserves has been actively entering the domestic market. These volumes are sufficient to meet Japan's needs for 45 days. Sales to wholesale companies are conducted at reduced prices that were fixed before the onset of strikes by the United States and Israel against Iran. Japan's total strategic reserves amount to an impressive 470 million barrels. This quantity is enough to cover the country's energy needs for a full 254 days. Thus, Japan demonstrates serious preparedness for any challenges in the field of energy security.