Japan’s Return to Russian Crude Raises Questions About Asia’s Energy Trade Realignment

Japan resumed imports of Russian Sakhalin crude in May after two domestic refiners purchased cargoes under a U.S. sanctions waiver, marking Tokyo’s most notable return to Russian oil since supply disruptions in the Middle East heightened concerns over energy security.

The purchases highlight Japan’s reliance on oil supplies from the Middle East, some of which pass through the Strait of Hormuz. Japan was looking for other supplies for its energy needs after disruptions to energy supplies from the Gulf countries, as Sakhalin-2 became one of the few supplies readily available due to an existing U.S. sanctions exemption.

Japanese refiner Taiyo Oil confirmed it had purchased a cargo of crude oil from Russia’s Sakhalin-2 project, with the shipment arriving at a terminal in Ehime Prefecture on May 4.

The company said the purchase was made at the request of Japan’s Ministry of Economy, Trade and Industry to help secure stable petroleum supplies. The crude will be refined into gasoline and other petroleum products at Taiyo Oil’s Imabari refinery.

Idemitsu Kosan confirmed to TASS that it had also purchased a cargo of Sakhalin Blend crude. The company said the decision was made “at the request of the Natural Resources and Energy Administration to ensure stable supplies of petroleum products” as part of efforts to diversify its import sources.

The transactions are seen as a partial restoration of Russian crude imports to Japan, which has now cut off all imports of Russian crude oil since the start of its full-scale invasion of Ukraine in 2022, but continues to import a small volume as a part of the Sakhalin-2 project under sanctions exemptions.

Why Japan Had Few Alternatives

The renewed buying by Japan highlights the nation’s ongoing dependence on energy imports from the Middle East. As of January 2026, 73.7% of the Japan’s imports of crude oil passed through the Strait of Hormuz, and 95.1% of the total crude oil imports into Japan came from the Middle East, according to the Japan’s Ministry of Economy, Trade and Industry.

The ministry’s data also showed Japan’s crude oil imports in March 2026 fell 17% year over year to their lowest monthly level since 1989. Imports from Qatar declined 81%, while shipments from Kuwait and the United Arab Emirates fell 64% and 22%, respectively.

Speaking during a visit to Australia, Japanese Prime Minister Sanae Takaichi said the effective closure of the Strait of Hormuz “has been inflicting enormous impact on the Indo-Pacific,” adding that Japan and Australia had agreed to maintain close coordination in responding to the disruption, Reuters reported.

Against that backdrop, Sakhalin-2, located in Russia’s Far East, became one of the few available alternatives. The project remains partially exempt from Western sanctions, with a U.S. waiver allowing oil sales until June 18, 2026. Japanese trading houses Mitsui and Mitsubishi retain minority stakes in the project, while Russia’s Gazprom remains the controlling shareholder.

A Broader Emergency Procurement Effort

The purchases may not be isolated transactions. According to multiple media reports, Japanese officials also asked Fuji Oil, an affiliate of Idemitsu Kosan, to accept Sakhalin-2 crude shipments after similar cargoes were arranged through Taiyo Oil.

The Oman-flagged tanker Voyager, carrying Sakhalin Blend crude, departed Sakhalin in late April before unloading cargo at Taiyo Oil’s Shikoku refinery and later proceeding to Tokyo Bay, where Idemitsu operates refining facilities.

Japan is not the only Asian economy to increase purchases of Russian energy products following supply disruptions. The Carnegie Endowment for International Peace noted that South Korea recently imported 27,000 tons of Russian naphtha after U.S. restrictions were eased, while countries including the Philippines and Indonesia have also purchased Russian oil or petroleum products amid tighter regional supplies.

Carnegie also noted that Japan has continued importing limited quantities of Russian crude roughly once a year since 2022, with its previous shipment arriving during the summer of 2025.

Structural Constraints Remain

Despite the renewed imports, analysts say significant obstacles would make a broader revival of Russian oil purchases difficult.

According to the Carnegie Endowment, Japanese companies continue to face insurance challenges for sanctioned cargoes. Existing coverage provided by the Japanese government and the Japan P&I Club would likely be insufficient to support a substantial increase in imports unless broader sanctions are eased.

The think tank also said Japan would struggle to compete with China for Russian crude because Moscow continues to prioritize exports to China and India. Existing Western sanctions also remain a significant constraint on expanding purchases.

The United States has also indicated that it expects allies to continue reducing Russian energy imports. U.S. Treasury Secretary Scott Bessent said after meeting Japan’s finance minister that Washington expects Japan to stop importing Russian energy.

Russia also faces production constraints. Moscow has banned jet fuel exports through Nov. 30, 2026, to preserve domestic supplies following repeated Ukrainian drone attacks on refining infrastructure. Russian crude processing fell to 4.7 million barrels per day in April 2026, its lowest monthly level since December 2009.

What It Means for Asia’s Energy Trade

Japan’s renewed Sakhalin imports come as energy flows across Asia continue to adjust to disruptions in the Middle East.

Jet fuel prices have risen more than 120% since the conflict began, increasing from about $80 per barrel before the fighting to a peak of $216 per barrel. South Korea, Singapore, India and Japan remain among the region’s largest jet fuel producers and are particularly exposed to disruptions affecting the Strait of Hormuz.

The shifting supply landscape has also increased the strategic importance of energy exporters outside the Gulf, including Russia. On March 12, the United States temporarily eased sanctions on Russian oil transported at sea, marking its first significant sanctions adjustment since Russia’s invasion of Ukraine in 2022 as Washington sought to contain global energy prices.

Whether Japan’s renewed Sakhalin imports develop into a longer-term adjustment in regional energy trade will likely depend on the duration of disruptions in the Strait of Hormuz, the future of the U.S. sanctions waiver and the availability of alternative crude supplies.