Japan's national oil reserve will be raised to 95 from the current 90 days supply for the time being, Economy, Trade and Industry Minister Toshihiro Nikai said Friday.
The measure is designed to prevent any shortage that could arise from the ongoing surge in oil prices and political instability in the Middle East. Japan gets about 90 percent of its oil from the region.
The extra five days supply, or 15 million barrels in crude oil terms, would cost about 100 billion yen when purchased for $60 per barrel.
One day of the supply will come in the form of other petroleum products, Nikai said after a Cabinet meeting. This will mark the first time that gasoline and kerosene, or oil other than crude, will make up part of the national reserve.
Algerian LPG project
Ishikawajima-Harima Heavy Industries Co. and Itochu Corp. said Friday they have landed a 15 billion yen Algerian order to upgrade an existing plant to produce liquefied petroleum gas.
The deal with Algerian national energy firm Sonatrach is for the two Japanese companies to improve LPG facilities at the GP2/Z plant in Arzew, western Algeria, and take steps to bolster the safety of and test the improved facilities.