Tanker attacks spark concerns among Japanese companies

June 15, 2019

Tokyo--Concerns are growing among Japanese energy and other companies over the Middle East situation following Thursday's attacks on two tankers near the Strait of Hormuz.

The attacks on the tankers, including one operated by a Japanese shipping company, "have had no immediate impact on crude oil supply," said an official of oil wholesaler Idemitsu Kosan Co. <5019>.

As of the end of May, Japan had crude oil reserves equivalent to over 200 days worth of consumption in total in the public and private sectors.

Crude oil prices stabilized after shooting up following the attacks. Gasoline prices in Japan are "unlikely to rise immediately," a Japanese oil industry source said.

Japan imports about 80 pct of its oil and some 30 pct of its natural gas through the Strait of Hormuz. The waterway is "a lifeline to Japan," a senior industry ministry official said.

Japanese energy-related companies are collecting information as they brace for a situation in which the Middle East will remain unstable for a long time.

"We expect anything may happen," Satoru Katsuno, chairman of the Federation of Electric Power Companies of Japan, told a news conference Friday.

"We'll pay close attention to future developments with a sense of crisis and manage risk" with the possibility of a closure of the strait in mind, said Katsuno, also president of Chubu Electric Power Co. <9502>.

Major Japanese shipping firms have taken steps, such as an increase in the number of personnel on lookouts aboard ships or full-speed operations of vessels in waters near the sites of the attacks.

"There is nothing more we can do," said a public relations official at Mitsui O.S.K. Lines Ltd. <9104>.

"We'll have to reconsider operating ships in that sea area if the danger increases further," an official of another major shipping firm said. Jiji Press