New Delhi / Tokyo: India and Japan are working on how to release crude oil reserves together with the United States and other major economies to reduce prices, seven government sources with knowledge of the plan to Reuters.
US President Joe Biden has asked China, India, South Korea and Japan to release coordinated oil shares because US gasoline prices soar and rank their approval ahead of the election of the medium-term congress next year.
Demand comes after the US government cannot persuade OPEC + to pump more oil with the major producers that argue the world does not lack crude oil.
Japanese Prime Minister Fumio Kishida signifies his readiness to release shares over the weekend.
Three government sources said on Monday they held a consultation with the United States on the release of oil from strategic reserves.
Japan, the fourth largest oil buyer in the world, is limited to how it can act with its reserves – consisting of personal and public shares – which usually can only be used in times of deficiency.
A Japanese source said the government was looking to release from the part of the state shares outside the minimum amount needed as a legal solution.
Japanese officials also see personal stocks which are part of national reserves, which according to several advisors can be released without limitation, the second source said.
The reserves of Japanese oil companies have been tapped during the 1991 Gulf War and participated in the 2011 earthquake and tsunami disaster.
Brent crude fell 0.7% on Monday because of the upcoming locking in Europe and planning to release oil.
Japanese oil reserves make daily petroleum consumption 145 days at the end of September, according to official data, far above the minimum 90 days needed by law.
Japanese private companies including refiners have around 175 million barrels of crude oil and oil products as part of the strategic Petroleum Reserve (SPR), sufficient for consumption of 90 days, according to the Jogmec State Agency, also exceeds a minimum requirement of 70 days.
India holds around 26.5 million oil barrels in the SPR.