Japan, Indonesia step up energy ties as U.S.-Israeli Iran war strains supplies

Japan and Indonesia will deepen coordination on energy security, Tokyo said, as the U.S.-Israeli war on Iran disrupts vital oil and gas flows to Asia.

Japan’s Prime Minister Sanae Takaichi said the two countries would strengthen cooperation amid growing concern over the conflict’s impact on global energy markets. Speaking in Tokyo alongside Indonesia’s President Prabowo Subianto, she said the Iran situation had renewed global focus on resource security, describing Indonesia as a major resource-rich nation.

The leaders met as tensions in the Middle East disrupt shipments through the strategically important Strait of Hormuz, a key route for oil and gas supplies to Asia.

Indonesia is the world’s largest exporter of thermal coal for power generation, accounting for about half of global exports. It is also a major liquefied natural gas supplier, with roughly a quarter of its shipments destined for Japan.

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Japan said on Friday (27 March) it will allow utilities to increase the use of coal-fired power plants from next month to cushion potential disruption to liquefied natural gas imports caused by the war.

Both leaders said they would “make their best efforts to convince all parties (in the Middle East) to de-escalate” the conflict. Prabowo also invited Japan’s participation in Indonesia’s economy, including in critical minerals, rare earths, industrialisation and nuclear energy.

Neither leader provided details on how the two countries would coordinate on economic security.

In response to the conflict, Japan has opened its oil stockpiles and is seeking energy supplies beyond the Middle East.

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