US Sanctions Threaten Japan-Iran Oil Imports

Japan's oil refiners may face difficulties in importing Iranian crude oil due to upcoming US sanctions. According to Takashi Tsukioka, president of the Petroleum Association of Japan and chairman of Idemitsu Kosan Company, Japanese buyers of Iranian oil will have to make their last order for Iranian oil in August for September-loading cargoes if payments to Iran cannot continue after a 180-day wind-down period ending on November 4. This is because payment for October-loading cargoes would be made in November.

The US has set an exemption deadline of November 4, which means that any payment made after this date could trigger sanctions. Refiners in South Korea have already begun shunning Iranian oil and instead buying naphtha from elsewhere to feed their petrochemical plants. This shift is a result of the US pressure on its allies to comply with the sanctions.