Japan has pledged $10bn to support Asian countries grappling with an oil supply crunch, as the region faces disruptions linked to the Iran war, reports the BBC.
The package, announced on Wednesday by Prime Minister Sanae Takaichi after an online meeting with Asian leaders, aims to help countries – particularly in Southeast Asia – secure crude oil and maintain critical supply chains.
Japan said the cooperation framework would support the procurement of petroleum products, strengthen stockpiles and stabilise supply networks at a time of heightened uncertainty in global energy markets.
“Japan is closely interconnected with each Asian country through supply chains and mutually dependent with them,” Takaichi said at a press briefing.
Asia remains especially exposed to disruptions in the Strait of Hormuz, a key transit route where nearly 90 per cent of oil and gas shipments are destined for the region.
Japan’s foreign ministry said the $10bn commitment was roughly equivalent to one year’s crude oil imports for countries in the Association of Southeast Asian Nations (Asean).
Leaders from across the region, including the Philippines, Malaysia, Singapore, Thailand, Vietnam, Bangladesh and South Korea, welcomed the initiative at the meeting, the ministry said.
Funding will be drawn from a mix of public and institutional sources, including the Japan Bank for International Cooperation, Nippon Export and Investment Insurance, the Japan International Cooperation Agency and the Asian Development Bank.
Takaichi said the plan would not affect Japan’s domestic energy security. At the end of 2025, Japan’s oil reserves covered 254 days of domestic consumption. However, authorities have already begun tapping into those reserves amid the global energy crisis.
Last month, Japan released a record 50 days’ worth of oil, and officials have said a further 20 days’ supply will be released in early May.
Concerns are also mounting over potential shortages of naphtha; a petrochemical derived from crude oil and widely used in plastics.
The issue is particularly acute in the healthcare sector, where items such as syringes, gloves and dialysis equipment depend on naphtha-based materials.
While Takaichi has urged calm, saying there would be no immediate disruption, officials remain wary of additional pressure on the healthcare system, which is already under strain from Japan’s ageing population.
Across Southeast Asia, rising oil prices have triggered broader concerns. Governments in the region have urged citizens to reduce energy use, including limiting air-conditioning and sharing transport.
The Philippines has declared a national energy emergency, underscoring the severity of the situation. At the same summit, Philippine President Ferdinand Marcos Jr called on Asean to activate its fuel-sharing mechanism.
“No single country in Asia can insulate itself from supply chain shocks of this scale by acting alone,” he said.
