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Sun 1 Oct 2006 12:00 AM

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Japan ready for an Iran oil crisis

Nippon Oil Corp chairman Fumiaki Watari said in September that NOC—Japan’s largest oil importer and distributor—could buy enough crude on global markets to make up for any disruption to supplies from Iran.

He also said that he hoped Iran, one of Japan’s top sources of oil, would heed international calls to halt sensitive experimental nuclear work or face possible economic sanctions.

“We deliver one million barrels per day and about 13% of it comes from Iran.

We can procure this amount of 130,000 barrels in the spot market,” Watari told reporters at the Foreign Correspondents’ Club of Japan.

Two years ago Japan signed a two-billion-dollar contract to develop Azadegan, the Islamic Republic’s largest onshore crude field, which Watari said is a “very important petroleum project for Japan.”

Japan, the world’s second largest economy and third largest oil consumer, is almost entirely dependent on the Middle East for its oil and some 15% of the oil it consumes comes from Iran.

Even so, a senior Japanese trade official said last week that Japan’s oil reserves are large enough to manage a possible oil crisis if sanctions hit Iran over its nuclear programme.

“Unlike in the past two oil crises, now we have enough oil reserves. I believe we can deal with it without major trouble,” vice minister of Economy, Trade and Industry Takao Kitabata told a news conference.

Japan is reported to have a stockpile of 168 days’ worth of oil stored by the government and private sector.

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