In a recent development, Japanese oil refiners are being urged to diversify their crude oil supply sources, as 95% of Japan’s imports currently originate from the Middle East. Shunichi Kito, president of the Petroleum Association of Japan (PAJ) and head of Idemitsu Kosan, Japan’s second-largest refinery, highlighted the challenges of importing heavy Canadian crude during a press conference in Tokyo. Kito emphasized the difficulty of investing in new refining facilities due to a steady 2% annual decline in domestic oil demand, leaving the decision to individual companies. Meanwhile, Alberta, Canada’s primary oil-producing province, is exploring financial investments in Japan’s refining sector. Sources indicate that Alberta is in preliminary discussions with several Japanese refiners to potentially fund the construction of coker units, which would enable the processing of heavy crude from Alberta’s oil sands. This move aims to reduce Alberta’s heavy reliance on the United States for oil exports. While Kito acknowledged the need for diversification, he noted that no specific requests have been made to Japanese refiners yet. The initiative reflects broader global efforts to balance energy security and sustainability amidst shifting market dynamics.
Japan should diversify oil sources but Canadian supply seen tough, industry association head says
