Japanese Prime Minister Fumio Kishida said on Wednesday that Japan will release oil, which would be the first time for the resource-poor country, to try reducing prices by tapping oil reserves.
"Japan has decided to act in tandem with the United States and sell a portion of the state-owned stockpiles in a manner that does not violate the oil stockpiling law," said Kishida.
The oil stockpiling law limits the release to purposes such as responding to disasters and overseas political turmoil.
In order not to violate the law, Tokyo plans to release oil reserves that exceed its target of storage in value of 160 days of consumption. The amount of oil to be initially released is expected to be equivalent to consumption in several days, according to a government official.
The White House announced Tuesday that the United States will release 50 million barrels of oil from its emergency reserves in coordination with other major energy-consuming countries to address rising prices. Some other countries are also expected to take similar actions.
However, oil prices continued to rise in New York overnight and in Tokyo, with doubts appearing about the effectiveness of the move as the amount of oil to be released is only worth several days of consumption.
In Japan, the decision to develop reserves in the past was to solve supply problems after natural disasters and overseas political turmoil. So far, the country has implemented five releases, including after the Gulf War in the early 1990s and the March 2011 earthquake and tsunami in northeastern Japan.
As a member of the International Energy Agency, Japan is obliged to maintain oil reserves equivalent to 90 days of net imports in the previous year, and the amount of private emergency reserves should exceed 70 days of its oil consumption in the previous year, according to the Japanese law.
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