Two months after Washington and Tehran agreed to end hostilities, there is still no clear path for normalizing energy trade through the Strait of Hormuz.
For Japan, crude oil procurement costs remain high and elevated prices are weighing on corporate activity.
Even though the United States and Iran were expected to negotiate a peace agreement during the 60-day period through Aug. 16, attacks around the key waterway continued to flare up.
Japan has moved beyond the state of emergency phase that immediately followed the first U.S.-Israeli attacks on Iran in February. It has diversified crude oil procurement and slowed the pace of drawing down its stockpiles.
The country has long depended on the Strait of Hormuz, a strategic chokepoint for global energy transport, for more than 90 percent of its crude oil imports.
In response to the effective blockade, the government began releasing oil reserves in March. It also scrambled to secure alternative supply routes that bypass the strait.
According to the trade ministry, crude oil procured in April was only 25 percent of the volume required.
However, Japan secured more than it needed in July, and supplies are also expected to meet demand in August.
There were only three Japan-affiliated vessels stranded inside the Persian Gulf as of Aug. 14, down from 45 on Feb. 28, according to Japanese Shipowners’ Association data.
Still, alternative procurement arrangements are not on a firm footing.
Japan’s greatest replacement source is U.S. crude oil. Imports in August are expected to have increased about 10-fold from a year earlier.
But some observers believe there are limits to future supplies because the United States is drawing down its own reserves to maintain exports.
The financial burden is also substantial.
In the shipping industry, demand for vessels has increased. Rising fuel costs and additional expenses incurred from rerouting are exerting strain.
In a survey conducted by Teikoku Databank Ltd. in June, about 90 percent of companies said rising energy prices were having a negative impact on their operations.
