Japan Likely To Cut Iranian Oil Imports In Three Months

Japanese refiners are expected to reduce oil imports from Iran in about three months in line with US sanctions against Iran, the head of Japan’s oil industry association said Thursday.

“The oil companies cannot keep doing business with Iran if banks stop transferring money for imports. There will be no option but to reduce oil imports from Iran,” Akihiko Tembo, chairman of the Petroleum Association of Japan and oil refining company Idemitsu Kosan Co., told a press conference.

“I think the reduction will start in about three months,” said Tembo, adding that oil distributors are making efforts to secure other oil suppliers.

His remarks came after the US asked for Japan’s cooperation with its sanctions aimed at stopping the Iranian oil trade. Late last month, US President Barack Obama signed into law a bill that imposes tough sanctions against financial institutions dealing with the central bank of Iran.

The proposed sanctions are aimed at cutting off Iran’s main source of income to force the country to give up its nuclear ambitions.
Iran has threatened to close the Strait of Hormuz if the US and the European Union impose new sanctions on its crude oil exports.
US officials, led by Robert Einhorn, the State Department’s special advisor on nonproliferation and arms control, have been in Tokyo since Wednesday to seek Japan’s participation in the US-proposed sanctions.

Japan, the second-biggest importer of Iranian crude after China, imports about 10 percent of its oil from Iran.

During the talks, the Japanese side on Thursday requested that the US grant it a waiver from new sanctions on Iran, pointing to the risk of an economic setback and already reductions in its oil imports from the Middle Eastern country, Kyodo News Agency quoted a senior Foreign Ministry official as saying.

The two sides have not struck a deal on whether or how to reduce Japan’s reliance on Iranian oil, the official said, adding bilateral consultations regarding the US measures will continue in the weeks ahead.

Japan is in need of more energy from abroad as it has idled many nuclear reactors since the meltdown at the Fukushima Daiichi power plant, triggered by the March 11 earthquake and tsunami.

Earlier this week, the US officials made a similar request to South Korea, which also counts on Iran for about 10 percent of its oil. South Korea said Tuesday it has yet to decide whether it will join the campaign.