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Japan urges UAE to pump more oil as prices increase

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A service attendant fills up a vehicle at a petrol station in Tokyo. AFP

Japan urges UAE to pump more oil as prices increase

Japan on March 20 urged the UAE to pump more oil to calm markets rocked by Russia’s military offensive in Ukraine, the latest major consumer to lobby Gulf producers.

The plea by Japan’s Foreign Minister Yoshimasa Hayashi came during meetings with Emirati officials which coincided with a visit by Germany’s economy minister, three weeks into the Russian offensive.

British Prime Minister Boris Johnson also flew to the UAE and Saudi Arabia to push for more oil last week in a bid to ease prices of over $100 a barrel and secure non-Russian supplies.

Hayashi asked “the UAE to contribute to the stabilisation of the international oil market by supplying a greater amount of oil, securing spare productive capacity as a leading member of OPEC+”, a Japanese foreign ministry spokesperson told an online briefing.

The UAE supplies about a third of Japan’s oil imports.

There was no promise of more production from the UAE, which has stressed its alignment with the OPEC+ oil alliance that includes Russia.

Hayashi’s talks with UAE Foreign Minister Abdullah bin Zayed Al Nahyan and Industry Minister Sultan Al Jaber come after Prime Minister Fumio Kishida made the same request in phone calls with the Emirati and Saudi leadership last week.

The UAE “may be more willing to open the taps” than Saudi Arabia as it wants to capitalise on its oil reserves more quickly, Torbjorn Soltvedt, Middle East and North Africa analyst at Verisk Maplecroft, told AFP last week.

The UAE’s ambassador to the US signalled the previous week that it favoured higher production in OPEC+, sending prices lower. But the UAE reaffirmed its commitment to OPEC+ just a day later.

Calls to raise oil production have so far fallen on deaf ears.

“I think you need to talk to the Saudis about that,” Johnson said after his trip to Riyadh, when asked if he had won any guarantees for more oil.

Analysts say oil producers don’t have the spare capacity to replace Russian exports, and are reluctant to cause a rift with their OPEC+ partner.

They also fear creating market panic if all reserve capacity is used up, analyst Amena Baker from Energy Intelligence told AFP this month.

However, Germany announced a long-term energy partnership with Qatar on March 20 as it looks to reduce its dependence on Russian gas.

The agreement came following a visit to Doha by German Minister for Economic Affairs Robert Habeck, who then travelled to the UAE.

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