Japan’s government has activated a twin response to the Middle East energy crisis, announcing the biggest-ever oil reserve release — approximately 80 million barrels to domestic refiners from Thursday — in tandem with a nationwide fuel subsidy scheme designed to protect consumers from record-high gasoline prices. Prime Minister Sanae Takaichi confirmed both measures as part of Japan’s response to disruptions at the Strait of Hormuz caused by the US-Israel conflict with Iran. Together, the reserve deployment and price subsidies represent the most comprehensive energy protection package Japan has ever put in place.
The subsidy scheme, which caps gasoline prices at approximately ¥170 per litre, was introduced after retail prices climbed to a record ¥190.8. It will be reviewed weekly, allowing the government to calibrate the level of support in response to evolving global oil prices. Officials from the trade and industry ministry have described the subsidy as essential to preventing the international oil price spike from causing disproportionate hardship for Japanese households and businesses.
The reserve release adds supply-side support to the demand-side price protection of the subsidies. The 80 million barrel deployment — equivalent to 45 days of national oil consumption, 1.8 times the previous record from the Fukushima era — will help ensure that domestic refiners have adequate crude to meet demand. Japan’s total reserves of approximately 470 million barrels, covering 254 days of consumption, provide a solid foundation for this intervention.
Japan’s energy situation is acute: over 90% of its crude comes from Middle Eastern producers, and the Strait of Hormuz is the indispensable route through which this supply flows. The US-Israel conflict with Iran has disrupted this corridor, creating the immediate supply concern that has driven the government’s historic response. Officials say they are monitoring developments on a daily basis and are prepared to adjust their response as conditions evolve.
The diplomatic dimension of Japan’s response is equally active, with Takaichi declining military involvement in the Hormuz area while pursuing extensive multilateral diplomacy. Her refusal of Trump’s naval deployment request was grounded in Japan’s postwar constitution. Japan’s combination of supply-side reserves, demand-side subsidies, and diplomatic engagement represents a comprehensive strategy for managing this multifaceted crisis.
