Japanese Oil Prices Surge Due to Russian Sanctions While Global Markets Rise Modestly: Impact of Global Energy Crisis

An 8.5% price surge in just one week—that's the "shock" Japan's oil market is experiencing, while global oil prices rose a modest 1-1.8%. Did you know that a taxi driver in Tokyo now pays $87-89 for a barrel of oil, $6-7 higher than global prices? This is the direct consequence of new US sanctions targeting Russia's oil sector and Ukraine's campaign of attacks on energy infrastructure.

It's hard to imagine how such a sudden spike in fuel costs over just a few months directly impacts the lives of millions of Japanese people—and us as well. Is this the beginning of a new energy crisis? And why has the oil market "split" so dramatically?

Japan: When 3.8% of Russian Oil Supply Becomes "The Last Straw"

To understand this crisis, we need to look at a seemingly small number: 3.8%. That's the percentage of crude oil Japan imports from Russia—equivalent to 115,000 barrels per day out of total demand of 3.05 million barrels per day.

This figure may seem insignificant, but in today's tight energy markets, it has become "the last straw." Why? Because Japan must import 95% of its crude oil needs and now faces fierce competition with two major consumers of Russian oil: China (1.6 million barrels/day) and India (1.4 million barrels/day)—countries maximizing their purchases of discounted Russian crude.

Yamamoto Kenji, a 52-year-old taxi driver in Tokyo, shared: "My fuel costs have increased 25% in just the past month. I've had to raise fares to cover expenses, but customers are starting to complain. This is the first time in 20 years of driving that I've felt this worried."

Japan's crude oil import structure according to latest METI data:

• Middle East: 88% (Saudi Arabia 32%, UAE 25%, Kuwait 18%, Qatar 13%)
• Russia: 3.8% (115,000 barrels/day)
• Other countries: 8.2% (Malaysia, Brunei, Australia)

Russian Oil Sanctions: The "Opening Blow" from Washington

The primary cause of this oil price "fever" stems from America's new strategy: expanding the "blacklist" to 50-70 Russian oil and gas companies, including "super corporations" like Lukoil (producing 1.7 million barrels/day) and Gazprom Neft (1.3 million barrels/day).

Particularly dangerous are "secondary sanctions"—anyone doing business with sanctioned Russian companies will also face penalties. This creates a "chilling effect" causing shipping companies, insurers, and banks to refuse dealings with Russian oil, even when not directly prohibited.

The frightening figure: Russia currently produces 11.3 million barrels of crude oil daily, accounting for 11% of global production (103 million barrels/day). If this supply is severely cut, markets will face a shortage of 2-3 million barrels/day—enough to drive oil prices to "insane" levels.

Dr. Nakamura Akira, energy expert at Tokyo University, noted: "This isn't just economic warfare but a reshaping of the global energy map. Japan is becoming a 'hostage' to this geopolitical confrontation."

Ukraine's Infrastructure Attacks: When War "Ignites" the Entire Oil Industry

While the US tightens the economic noose, Ukraine has escalated to "direct attacks" on infrastructure. In August, Ukrainian forces conducted 18 drone and missile attacks on the heart of Russia's oil and gas sector.

"Devastating" damage: The Ryazan refinery—a "super plant" with 17 million tons/year capacity—was forced to halt operations for 3-4 weeks. Along with Novokuibyshevsk (7 million tons/year) and Syzran (6 million tons/year).

The result? Ukraine has "paralyzed" 800,000-1 million barrels/day of Russian refining capacity—equivalent to 20-25% of the country's capacity. Consequently, Russia is importing gasoline from Belarus and Kazakhstan for the first time in 30 years!

"Domino Effect" Across Asia: When Japan "Sneezes," the Entire Region "Catches Cold"

Japan's oil "thirst" is spreading like a "domino effect" throughout Asia:

• South Korea: oil prices up 4.2% in the past week
• Singapore: up 3.8%
• Thailand: up 3.1%

Weak currencies compound the situation:

• Japanese Yen down 12% over six months
• Korean Won down 8%