Money Matters - Simplified

Japan Uncertain Over Cutting Iranian Oil Imports

The latest reports confirm that Japan hasn't reached any accord with the U.S. on crude import cuts from Iran. Japan’s move to reduce oil import from the Islamic Republic is directed towards gaining immunity from the latest U.S. sanctions.

Though Japan has not signed a concrete agreement with the U.S. so far but the island nation is planning an 11 percent cut in crude imports from Iran.

"We are closely negotiating with the United States and are moving forward towards mutual understanding, but it is not the case that we have reached a conclusion," maintained Trade Minister Yukio Edano.

With this trade cuts, Japan will join hands with western states to boycott Iran’s alleged involvement in creating nuclear weapons.

Japan needs Iran's oil to meet ends
Critics suggest that Japan’s oil import cuts would definitely hurt the nation’s economy. The trade statistics show a higher dependency on energy imports since 2011's earthquake and tsunami as the same led to the Fukushima radiation crisis and economy is still resurrecting from it.

On the other hand, cutting oil imports from Iran is also essential in order to protect Japan’s financial sector overseas.

U.S. last week had further strengthened sanctions against financial institutions associated with the central bank of Iran, as U.S. and its allies have been incessantly growing doubtful that Iran’s nuclear program is inclined towards meeting its military ends.

Japan’s Showa Shell to continue imports
Amid growing uncertainties over trade and foreign issues, Japan’s Showa Shell plant has declared it has no plans to cut down on oil imports from Iran.

Showa Shell Sekiyu KK is the nation’s fifth largest refinery and a Royal-Dutch Shell affiliate. The company maintained on Monday that the latest U.S. sanctions have no impact on its crude oil trade with Iran.

The company further added that French and British oil holds from Iran would evidently have no effect on imports to Shell Japan. The Showa Shell branch will run as it is irrespective of trade halt in Shell offices worldwide, as Showa Shell is on separate contractual terms with Iran.