350

Takaichi urged to cancel U.S. oil and gas deals, prioritize homegrown renewables as oil hits $100/barrel 

Tokyo – New analysis by climate organization 350.org shows that elevated oil and gas prices have imposed already additional $18.75bn on Japan since the start of the Iran war and will overall cost up to over ¥7 trillion (¥7238.50bn -¥7619.28bn) by the end of the year in case of continued escalation. Even in case of a swift normalization of the Strait of Hormuz and the region, higher oil and gas prices would still cost the Japanese people over ¥4 trillion (¥4489.97bn -¥4726.28bn).

With oil prices hitting $100 per barrel again due to renewed US-Iran hostilities and the Houthi’s blockade of Saudi Arabia’s oil, Japan has yet to make decisive policies to break its near total dependence on imported oil and gas, experts today said in a press conference hosted by 350.org. 

To avert further economic and climate damage, 350.org campaigners urged Prime Minister Sanae Takaichi to abandon plans to revive coal and nuclear power, and cancel multi-million dollar oil and gas investments in the US. Instead, they encouraged the Japanese government to invest in energy efficiency and renewable energy that can bring costs down for good.

350.org’s analysis is based on oil and gas pricing scenarios of the International Monetary Fund’s April 2026 World Economic Outlook, Japanese consumption data and observed price averages since the start of the Iran war on February 28. It does not yet account for wider knock-on effects, including rising fertiliser and food costs, lower economic output and employment, or rising inflation driven by fossil fuel price volatility. As a result, the true economic damage is likely to be significantly greater than the direct losses from higher oil and gas prices alone.

Masayoshi Iyoda, 350.org Japan Campaigner said:

“Over ¥7 trillion in higher energy bills is an outrage when people are struggling to cool their homes and cope with rising costs of living. Yet, the Japanese government chooses to funnel more taxpayer money into the same fossil fuels that are heating the planet and emptying people’s pockets. 

The Takaichi administration has yet to learn the lesson of the Hormuz crisis. Until we cut the cord on imported oil and gas, Japanese households will remain hostage to volatile fossil fuel markets. Until Japan invests in homegrown renewables and energy efficiency and steps up as a climate leader, we will suffer from exceptionally high bills and hot summers. 

The prospect of investing in decades more of expensive, unstable oil and gas in the era of cheaper renewables is now worrying even Japan’s business sector. This should be enough for the government to give pause and scrap new oil and gas deals with the Trump administration.”

Candice Fortin, 350.org US Campaign Manager said:

“Committing billions to new drilling, pipelines, and export terminals binds both the US and Japan to outdated fossil fuels for decades. But as renewable energy technologies become cheaper and more efficient, these investments risk becoming ‘stranded assets,’ basically unprofitable infrastructure rendered obsolete by the green transition.

Japan still commits to the Paris Agreement while the US moves away from the global climate pact, but both Japan and the US are going back to fossil fuel addiction. The US must stop wreaking havoc across the globe and instead work with international allies committed to a just transition so we can collaborate and end the global climate crisis.”

NOTES TO THE EDITOR

• 350.org’s analysis is based on oil and gas pricing scenarios of the International Monetary Fund’s April 2026 World Economic Outlook as well as pricing outlook of Goldman Sachs and consumption data of Japan as well as reduced demand due to higher prices and rationing measures.
• The analysis takes a deliberately conservative approach in estimating total losses due to higher prices.
  • It does not include wider knock-on effects such as higher food and fertiliser costs, broader inflation, or reduced economic output.
  • It compares rising prices against the price level in the week before the Iran war, e.g. Brent crude at USD 72 per barrel, a price that was already above levels seen in the preceding weeks and months of 2026 and likely already reflected market fears of disruption in the Middle East. This means the true economic impact is plausibly even higher.
  • Reduced demand resulting from higher prices and rationing is already accounted for.
  • For gas, estimates are based on Goldman Sachs forecasts (which for baseline are rather slightly below IMFs scenario) – weighted and adjustment based real-world observations/data and assuming a high correlation between European and Asian gas prices.
• Figures may vary slightly due to rounding, including converting units such as cubic meters into energy (EJ and MWh).

BASELINE SCENARIO

ADVERSE SCENARIO