Japan releases 80 million barrels of oil reserves into the market, locking in "pre-war prices" to forcefully combat inflation.

The Japanese Minister of Trade has publicly announced that Japan will sell its national reserve of oil at the price level before the outbreak of the Middle East war. This week, the country has officially announced that it will release around 80 million barrels of crude oil from both national and private reserves, with the release work set to start as soon as next week. The Japanese Minister of Economy, Trade, and Industry, Ryosei Akazawa, stated on Friday that the selling price of the crude oil will be determined based on the Official Selling Price (OSP) levels of oil-producing countries in the Middle East before the war. According to the details disclosed by the Japanese government, the total amount of the release operation this time is around 80 million barrels, which is equivalent to Japan's total oil consumption for 45 days nationwide. The specific release strategy will be carried out in two orderly stages: the first stage will release the commercial reserves equivalent to 15 days of consumption, followed by the government-led release of the national physical reserves equivalent to 30 days of consumption. The first batch of crude oil release work is expected to formally start as early as March 16, 2026. As the global benchmark, Brent crude oil closed at $72.48 per barrel on February 27 before the outbreak of the war, and its price has since risen to around $101 per barrel. If the conflict cannot be resolved in the short term and the Strait of Hormuz continues to be substantially blocked, oil prices are likely to further increase significantly. Akazawa stated that the government "hopes that refineries that can purchase oil at low prices will not take advantage of the situation to sell the products at higher prices to seek personal gain." He also said, "The government will maintain close communication with refineries to ensure that the release of national reserve oil is promoted in a way that the public finds reasonable and convincing." The deep background of this emergency intervention stems from Japan's high dependence on energy from the Middle East. Due to the escalation of US military actions against Iran, global energy traffic through the Strait of Hormuz, a crucial energy chokepoint, has been disrupted. Japan imports about 95% of its crude oil from the Middle East, with nine-tenths of it having to pass through the strait. In the early stages of the deteriorating situation, domestic oil product prices in Japan have been continuously rising. Without timely intervention, the surge in energy costs will have a severe impact on Japan's manufacturing industry and household consumption. Japan's unilateral release of national reserve oil comes at a time when the International Energy Agency is coordinating with developed countries to release 400 million barrels of oil reserves on a large scale. This Paris-based agency describes the energy crisis triggered by the Iran war as the most severe supply disruption event in the global oil market's history. Akazawa did not completely rule out the possibility. He stated that if domestic demand is not sufficient, the surplus oil products refined from reserve crude oil may be exported overseas. "This measure does not impose any prohibitive restrictions on exports," he said. Oil-producing countries in the Middle East determine the official selling price of crude oil under long-term contracts each month. The official selling price of different grades of crude oil varies, calculated by adjusting differentials to a set benchmark and considering market conditions at the time of pricing.