Japan has lowered its price cap on Russian crude oil to $47.60 per barrel, aligning with a similar move by the European Union. This action is intended to punish Russia for its continued war in Ukraine. The new price cap is largely symbolic because most of Japan’s current Russian crude imports are not affected.
Exemptions and Impact
The new price cap is not expected to impact Japan’s crude procurement since transactions related to the Sakhalin-2 project are exempt. This project is vital for Japan’s energy security, as it accounts for a significant portion of its liquefied natural gas (LNG) imports. Data shows that Japan’s crude oil imports from Russia already make up a very small percentage of its total imports.
Broader Sanctions
In addition to the new price cap, Japan will impose new asset freezes and export controls on Russian entities and those in other countries. These measures are part of a broader international effort to encourage peace in Ukraine.
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Source: Reuters
