Japan's Middle East Energy Dependency - and How it Mitigates Shocks
Around 95% of Japan's oil and 11% of its liquefied gas is imported from the Middle East. Around 70% and 6% of these imports come via the Strait of Hormuz which has been effectively closed by the Iran War. Here's a breakdown of Japan's energy dependence on the Middle East and how it can reduce its import risk. Around 95% of Japan's oil imports come from the Middle East. In January, Japan imported an average of 2.8 million barrels per day of crude oil, of which 1.6 millions bpd were from Saudi Arabia, with additional supplies coming from Kuwait, Qatar, and the United Arab Emirates. Japan has emergency oil reserves that are equivalent to 254-days of consumption.
Asia LNG price spike opens arbitrage to West to replace Qatari LNG supply
Analysts said that Asia's liquefied gas prices have risen, creating arbitrage opportunities for traders who want to ship cargoes to the east from the Atlantic in order to replace the Qatari supply which was lost during the U.S. - Iran?war. As the Middle East conflict reduces shipments, and Qatar's output is halted, cargo diverts could increase competition between the Atlantic basin and the Pacific basin. According to Kpler's data, Asian buyers account for more than 80% of Qatar's LNG sales. He added that the U.S. arb front month has increased to favor Asia deliveries, and the Norwegian arb for Asia has opened up again, the first since 2023.
UAE stock markets slide after a two-day suspension following the Iran attack
The stock markets in Dubai and Abu Dhabi reopened on Wednesday after a two-day suspension following Iran's unprecedented?wave of?missiles and drone attacks against the Gulf nation. Capital Markets Authority of the UAE closed ADX and DFM March 2 and 3 in order to prevent a meltdown. This was an unusual step, as it did not coincide with a holiday or mourning period. The combined market cap of both exchanges is approximately $1.1 trillion. Investors waited for clarity on the extent of the damage caused by the weekend strikes in both emirates, including the airports, the ports and the residential areas. Dubai's main share index fell 4.7% intraday, its largest drop since May 20,22.
METI does not see any need for an emergency LNG supply, despite the fact that Japanese utilities have increased their LNG reserves
The Ministry of Economy, Trade and Industry said that major Japanese utilities have increased their liquefied gas stocks by 10% to?2,19 million metric tonnes last week. The LNG stocks of Japan's utilities, the second largest LNG buyers in the world, equaled around 12 days domestic consumption for the week ending March 1. The LNG stockpiles of utilities in Japan, the world's second-largest LNG buyer, are equal to around 12 days domestic use for the week ending on March 1. Only 6% of Japan's total LNG imports come from the Middle East, specifically Qatar, Oman, and the United Arab Emirates. The Strait of Hormuz has been closed since the U.S. attack on Iran.
US-Israeli War on Iran Causes Major Oil, Gas Disruptions
The U.S. and Israel war against Iran has 'disrupted oil and gas exports out of the Middle East and forced production stops from Qatar to Iraq. Here are the main energy disruptions that have occurred so far. Iraq, the second largest producer in OPEC, has slashed its?output. Iraq has reduced nearly 1.5 million barrels a day - or about half - because of storage limitations and the absence of an export route. The country could be forced to close 3 million barrels per day, or nearly all its production, if exports don't resume. QatarEnergy LNG has been halted. Qatar stopped its LNG operations on Monday.
US considers oil tanker insurance to ease Middle East crude shipping, sources say
Two sources say that U.S. president Donald Trump will review on Tuesday a number of policy options to control energy prices in the face of the escalating conflict in the Middle East. One option is for the government help oil tankers obtain insurance. Since Israeli and U.S. troops began attacking Iran on the weekend, fighting has disrupted Middle East oil tanker deliveries. Sources, who spoke on the condition of anonymity, said that Treasury Secretary Scott Bessent will meet with Trump Tuesday afternoon in order to discuss the issue. They are also expected to finalize their response.
US-Israeli War on Iran Causes Major Oil, Gas Disruptions
The U.S. and Israel war against Iran has caused oil and gas exports to be disrupted from the Middle East, and production from Qatar?to Iraq was forced to stop. Here are the major energy disruptions that have occurred so far. Iraq, OPEC’s?second largest producer, has reduced?output by almost a third due to storage limitations and the absence of export routes, officials said. The country could be forced to close 3 million barrels per day, or nearly all its production, within days, if exports don't resume. QatarEnergy LNG halted operations: Qatar ceased operations at its LNG plants on Monday.
Venture Global shares soar after court rejects Shell’s challenge to LNG ruling
Venture Global's shares jumped by more than 8% Tuesday, reaching their highest level since 10 October after a New York court rejected Shell's bid to overturn an arbitral award in favor of the U.S. gas developer. The British oil giant had originally filed a complaint regarding Venture Global's alleged improper sales of LNG, but lost the arbitration in August. Shell appealed the decision in November. Justice Joel Cohen, of the state's?Supreme Court, said that no further evidence gathering was necessary and the court "owed substantial deference" arbitral decisions. We believe that the stock price is still depressed because of arbitration overhang.
Brent oil prices continue to rise amid Iran conflict with Brent reaching a 19-month high
The price of crude oil rose by about 7% Tuesday. This is the third time that oil prices have risen in a row. As the U.S./Israeli conflict with Iran intensifies, fuel shipments are disrupted, and 'fears' of further disruptions to Middle East oil supply and gas supplies increase. Brent crude futures rose $5.70 or 7% to $83.44 per barrel at 1326 GMT, after reaching their highest level since July 2024, $85.12. U.S. West Texas Intermediate Crude gained $5.03 or 7% to $76.26. It had previously reached its highest level since June, at $77.58. Since Friday, when the attacks began, both contracts are up as much as 17 and 16 percent, respectively.
Venture Global shares soar after court rejects Shell’s challenge to LNG ruling
Venture Global soared 17% on Tuesday in premarket trading after a New York court denied Shell's request for an arbitration award which favored the U.S. based developer of liquefied natural gas. The British oil giant had originally filed a complaint regarding Venture Global's alleged improper sales of LNG, but lost the arbitration in August. Shell appealed the decision in November. Justice Joel Cohen, of the State Supreme Court, said that no further?evidence gathering was necessary and that the court should give "substantial respect" to arbitral decisions. We believe that the stock price is still depressed because of arbitration overhang.
The number of forward contracts on the U.S./Iran conflict has increased by more than a month
European forward power contracts hit multi-month highs 'on Tuesday. They tracked higher natural gas prices and oil as the U.S. - Iran conflict intensified following the 'Tehran targeting of ships passing through the Strait of Hormuz. Some energy infrastructures were closed. Around 20% of all liquefied gas in the world transits the Strait of Hormuz. Traders fear that a suspension or complete closure would lead to a global increase in competition and higher prices for other gas sources. Iranian officials have vowed that the Strait of Hormuz will be closed, but U.S. Central Command has said it's not, Fox News reported.
Russell: China imports most energy but has the best position on Iran
China is the largest energy importer in the world and would appear to be vulnerable to the rise in crude oil and gas prices caused by the conflict between Israel, the United States and Iran. China's huge crude oil stockpile is a buffer against price spikes. This means that any energy-driven inflation in other parts of the world won't hit China. By increasing the exports of refined goods, China's refiners may also be able to reap a windfall profit in 'the?event?of a prolonged disruption of crude oil supplies from the Middle East. China can refine crude oil and export products like diesel and gasoline in order to profit from the inevitable rise in fuel prices.
India looks for alternative energy sources amid Strait of Hormuz disruption
A government source revealed on Tuesday that India is looking for alternative sources of crude oil, liquefied petroleum and natural gas in order to be prepared if the conflict in the Middle East continues for more than 15 days. The shipping through the Strait of Hormuz, between Iran and Oman - which carries a fifth of the oil and gas consumed worldwide - has come to a halt. This is after Iranian vessels were attacked in response to U.S. Source: The government monitors the situation constantly and is "reasonably certain that another window will be opened if one source shuts down", according to the source.
EUROPE GAS-European Gas Prices soar by more than 40% due to LNG Supply Fears
The benchmark Dutch and British gas price rose by more than 40% in the morning of Tuesday, as fears about supply grew after Iran and Israel intensified their attacks on the Middle East, and Qatar stopped 'production' at its Ras Laffan plant, which is the largest export facility in the world. Europe has been increasing its LNG imports over the last few years to replace Russian gas after Russia invaded Ukraine. It will need to import even more to replenish its rapidly depleting LNG storage. Due to the conflict in the Middle East, the Strait of Hormuz has been effectively closed, which means that nearly 20% of all LNG is no longer transiting through the Strait.
Sources: India cuts gas supply to industries following Qatar outage
Four industry sources with knowledge of the situation said that Indian companies reduced their natural gas supply to industries on Tuesday in anticipation of a tighter Middle East supply after top producer Qatar stopped production. Qatar stopped its production of liquefied gas on Monday as Iran continued to attack Gulf countries in response to Israeli and U.S. attacks against it. These attacks have also stopped oil and gas shipments through the Strait of Hormuz. This has pushed up energy prices globally and increased shipping costs. India is the fourth largest LNG buyer in the world. It imports a large amount of LNG from the Middle East.
The price of oil is rising as the US-Israeli war against Iran escalates supply risks
Brent rose by more than $3 Tuesday, marking a third consecutive day of gains. The U.S. - Israel conflict?with Iran?and threats to shipping via the Strait of Hormuz?increased fears of'supply.disruptions' from the Middle East. Brent crude futures stood at $80.89 per barrel by 0745 GMT, an increase of $3.15 or 4.1%. The contract reached $82.37 on Monday, its highest level since January 2025. However, it retraced these gains and settled 6.7% higher. U.S. West Texas Intermediate Crude climbed $2.55 or 3.6% to $73.78 per barrel. The contract reached its highest level since June 2025 in the previous session before falling back and settling at 6.3%.
Sources: India cuts gas supply to industries following Qatar outage
Four industry sources said that Indian companies reduced their natural gas supply to industries on Tuesday in anticipation of a 'tighter supply' from the Middle East, after Qatar, the top producer, halted its production. Qatar stopped its production of liquefied gas on Monday as Iran continued to attack Gulf countries in response to Israeli and U.S. attacks against it. The attacks have also caused a halt to oil and gas shipping through the Strait of Hormuz and increased?global energy costs and shipping fees. India, which is the fourth largest LNG buyer in the world, relies heavily on Middle East imports.
Russell: China imports most energy but has the best position on Iran
China, the world's biggest energy importer, is vulnerable to the rise in prices of crude oil and natural gas caused by the conflict between Israel and United States against Iran. China's huge crude oil stockpile is likely to be a buffer against any price spikes in the world, so that any energy-driven inflation will not affect China. In the event that crude oil supplies from the Middle East are disrupted for a long time, it is possible that China’s refiners could make a windfall profit by increasing exports of refined goods. China can refine crude oil and export products like diesel and gasoline in order to profit from the inevitable rise in fuel prices.
Oil prices rise as US-Israeli conflict escalates with Iran
Tuesday, oil prices increased for a third consecutive day as fears of supply disruptions from the Middle East region grew due to the U.S. - Israel conflict and threats against shipping through the Strait of Hormuz. Brent crude futures stood at $78.83 per barrel by 17:00 GMT, up $1.10 or 1.4%. On Monday, it surged to as high as $82.37 - its highest level since January 2025 - but then pared these gains, settling 6.7% higher. U.S. West Texas Intermediate Crude jumped 74-cents or 1% to $71.97 per barrel. The contract reached its highest level since June 2025 in the previous session before settling at 6.3%.
Minister: Qatar LNG stoppage won't affect Japan's energy supplies immediately
Qatar's LNG production halt caused by Iranian strikes won't affect Japan's supply of energy immediately. If there is an impact, Japan can tap the spot market, or utilities can buy from one another, said Trade Minister Yosei Acazawa on Tuesday. Akazawa said at a regular news conference that Qatari LNG accounts for 4% (of Japan's total LNG) imports. He also reiterated that the government has no plans to release any oil from its stockpiles while Japan bound ships are stuck in the Middle East. According to the Japanese government, companies in the country have enough LNG to last about three weeks. The oil stocks are equivalent to 254 days worth of net imports.