Japan plans to relax its oil reserves policy and will unleash stockpiles in the event of a surge in crude oil prices, government sources said Thursday.
Takeo Hiranuma, minister of economy, trade and industry, will announce the policy change during a two-day meeting of energy ministers of the Group of Eight nations that starts May 2 in Detroit, the sources said.
It will be the first time for a Cabinet minister to officially advocate a flexible stance regarding government oil reserves, they said.
The government plans to revise a law stipulating that state oil stockpiles be tapped only when there is a supply shortfall or when fears abound that the supply will dry up, according to the sources.
Under the proposed revision, soaring oil prices will be added as one of the conditions under which stocks may be tapped, the sources said.
Hiranuma hopes to win the support of his G8 counterparts in Detroit, and will emphasize the importance of cooperation among the member states to this end, they said.
Unleashing oil reserves is an apparent attempt to drag down oil prices on a temporary basis, the sources said.
Crude oil prices are surging due to supply fears provoked by the Middle East crisis. The price recently jumped to $27 a barrel.
In fall 2000, the United States unleashed its oil stockpiles to douse a similar price rise.
Hiranuma also plans to announce at the G8 energy meeting that Japan will take a central role in helping other Asian countries boost their oil reserves, the sources said.
He will point out that demand for crude oil is expected to rise rapidly in Asia, and that the region needs to be able to respond sufficiently during emergencies.
The government has never tapped into Japan’s oil reserves, which it has held since fiscal 1978.
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