Japan Plans To Build Pipeline Network Through Strait of Hormuz To Secure Energy Supplies

Japan is planning to construct a pipeline network bypassing the strategic Strait of Hormuz, after disruptions in West Asia due to the U.S-Iran war laid bare the vulnerability of depending on Gulf countries and suppliers for oil and gas.

Under this initiative, the government announced the Comprehensive Package for Strengthening Energy Supply-Demand Structure, also called the “Power GX” strategy.

The Cabinet Office outlined that this strategy would focus on achieving energy security by investing in reliable infrastructure internationally, diversifying the sources of procuring oil and has and also upgrading energy infrastructure within the country.

Japanese Prime Minister Sanae Takaichi told media that her government wants to finalise the rollout of the plan by the end of this year, adding that the dynamics of energy have changed, and so must the government’s policy.

Before the war began, Japan imported over 90% of oil from the Middle East; however, now that the situation remains precarious, with continuous ship attacks and seafarer deaths, the refiners in Japan are looking for other sources, including the United States, though processors are also relying on the country’s stockpiles to make up for the shortage.

The government plans to provide greater financial backing to Japan Organisation for Metals and Energy Security (JOGMEC). The state agency helps local companies fund foreign projects or international resource ventures.

According to sources, the priorities include expanding Saudi Arabia’s East-West pipeline, which ends at the Yanbu Port on the Red Sea and also the UAE’s Habshan-Fujairah pipeline, which terminates at the Gulf of Oman.

The Japanese companies would also work to suggest new trade routes to transport crude to the country, at the lowest cost possible.

Japan would also look for ways to get insurance coverage for ships and boost oil reserves for naphtha production in the country. Since using new routes via waterways and pipelines would lead to higher shipping costs, the government will also give logistical subsidies.

The strategy focuses on removing Japanese dependence on critical maritime chokepoints in the Middle East. Japan plans to establish around 12 to 14 nuclear reactors by the 2050s to meet the growing demands driven by AI data centres, research in renewable technologies, including hydrogen power and perovskite solar cells.