Japan's gasoline imports seen rising through August as refinery outages cut output
Japan's gasoline imports are expected to stay elevated through August after rising 20% in June as outages at its refineries are reducing output during peak summer demand season, traders and analysts said.
Import demand from Japan will further tighten supplies in Asia and support refiners' gasoline margins, which have rebounded to two-month highs earlier in July.
Japan's gasoline imports in June rose to 476,630 kilolitres, up 20.4% from the previous month, data from the Ministry of Economy, Trade and Industry (METI) showed on Wednesday.
This is equivalent to 99,930 bpd, up 24.5% from May, according to calculations. Japan's gasoline imports averaged at 55,168 bpd in 2023, according to calculations based on METI data.
"We expect Japan to import over 120,000 bpd–130,000 bpd of gasoline in July and August. This is mainly driven by a combination of planned maintenance and recent outages," Wood Mackenzie analyst Priti Mehta said.
A Singapore-based trader said higher imports from Japan due to unplanned outages will cause a decline in Asia's overall gasoline supply.
Cosmo Energy Holdings said it plans to increase gasoline imports for July–August from the same period last year but it didn't provide figures.
Rystad analyst Rohit Raveendran said the significant rise in imports is driven by a forecasted drop in refinery runs to about 1.9 MMpd in June, which could fall further to 1.7 MMbpd in the coming months due to unplanned shutdowns and ongoing maintenance.
Japan's average weekly refinery utilization rate fell to 63.6% in the week to July 27 from 66.2% in the prior week, data from the Petroleum Association of Japan (PAJ) showed.
PAJ said the imports could be rising due to maintenances and outages at plants owned by top oil refiner Eneos Holdings and Cosmo Oil during peak summer demand.
While there could be an increase in gasoline demand in a particular summer month, overall consumption is expected to decline by 2%–3% annually through the fiscal year of 2028, PAJ said, citing a recent METI's forecast.
According to METI prediction issued in April, gasoline demand is expected to continue falling due to a shift to next- generation vehicles such as hybrid cars and improved fuel efficiency of gasoline cars.
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