Qatar's LNG production halt due to Iranian strikes will not immediately affect Japan's energy supply, and if there is any impact, Japan could tap the spot market or utilities could buy from each other, Trade Minister Ryosei Akazawa said on Tuesday.
Akazawa told a regular press conference that Qatari liquefied natural gas accounts for 4% of Japan's total LNG imports and reiterated the government has no specific plans to release oil from stockpiles, while some Japan-bound ships are stranded in the Middle East.
If needed, Japanese companies have LNG inventory equivalent to about three weeks of consumption, according to the government, with the country's oil stockpiles holding the equivalent of 254 days of net imports.
The US and Israeli attack on Iran has pitched the Gulf into war, killed scores of people in Iran, Israel and Lebanon, thrown global air transport into chaos and shut down shipping through the Strait of Hormuz, where a fifth of the world's oil trade and a large amount of LNG skirt the Iranian coast.
Some 42 Japan-related ships are waiting in the Gulf, the country's foreign ministry said on Tuesday.
Qatar halted its LNG production on Monday, as Iran continued to strike Gulf countries in retaliation for Israeli and US strikes against it, prompting precautionary shutdowns of oil and gas facilities across the Middle East.
Japan, the world's second largest LNG importer, bought 3.4 million metric tons of LNG from Qatar last year, customs data shows, according to Reuters.
Together with LNG supply from Oman and the United Arab Emirates, Japan imported around 7 million tons of LNG from the Middle East last year, making up about 11% of its supply.
Some of Japan's biggest LNG importers, including JERA and Kansai Electric Power Co, have offtake contracts with the Middle Eastern producers.
Japan trades around 40 million tons of LNG annually and could redirect some of that back home in case of emergency. It also has a mechanism in place to buy at least one LNG cargo – or 70,000 metric tons – per month to mitigate supply risks.
