Japan’s Prime Minister Sanae Takaichi is weighing economic countermeasures, including potential releases from the nation’s strategic oil reserves, as the conflict in the Middle East drives crude oil prices higher. The move comes after Israel and the United States conducted strikes against Iran, escalating tensions and raising concerns about disruptions to global energy supplies.
Takaichi told parliament on Monday that the government is considering steps to curb gasoline prices, aiming to prevent increases “to levels that cannot be borne by households,” according to reports from Reuters and the Japan Times. The Prime Minister’s comments followed a press conference on February 28, where she stated the government was taking precautionary measures, including facilitating the evacuation of Japanese nationals from the region, in response to the initial attacks.
The surge in oil prices, exceeding $100 a barrel this week, poses a significant challenge to Japan, which relies almost entirely on imported energy. Economists warn that prolonged high energy costs, coupled with a weak yen, could push the country toward recession. Takahide Kiuchi, an economist at the Nomura Research Institute, cautioned of a “risk of stagflation” if oil prices continue to climb.
Takaichi’s response to the crisis marks the first major test since her landslide election victory last month, where she campaigned on promises to address rising food prices. The current situation adds another layer of economic pressure, requiring a delicate balance between supporting consumers and maintaining economic stability.
The Japanese government has also been assessing the safety of its citizens not only in Iran and Israel, but also in neighboring countries such as Bahrain, Qatar, and the United Arab Emirates. As of February 28, no reports of harm to Japanese nationals had been received, according to a statement released by the Prime Minister’s office.
Prime Minister Takaichi urged Iran to pursue a “diplomatic solution” to the conflict on Monday, according to Kyodo News. This call for de-escalation reflects Japan’s longstanding commitment to peaceful resolution of international disputes and its vulnerability to instability in the Middle East.
The conflict is also impacting trade routes, with China reportedly raising concerns with European shipping companies about extra freight charges and service suspensions. Japan has also secured a supply deal with Australian mining group Lynas Rare Earths at a minimum price guaranteed by the United States, aiming to secure a stable supply of rare earth materials crucial for technology manufacturing.
An Information Liaison Office was established at the Prime Minister’s Office on February 28 to gather information and coordinate the government’s response. Takaichi, who was traveling on party business at the time of the initial attacks, received ongoing updates and issued instructions as needed.
The situation remains fluid, with Iran’s foreign minister denying plans to attack U.S. Navy vessels, following warnings from former President Donald Trump regarding mines in the Strait of Hormuz. The potential for further escalation and disruption to energy markets continues to be a major concern for Japan.
