Japan Increases Restrictions in their Energy Deal with Russia

Published Date : Aug 06, 2014

In a bid to maintain their energy relations with both Washington and Moscow, Japan imposes new sanctions on Russia in their energy agreement. The sanctions, imposed last week, are more limited than what was ordered by the United States.

Japanese firms have expressed their leaning towards the Russian reserves of coal, oil, and natural gas, due to their abundance and Russia’s proximity to Japan. Will Pearson, the director of Eurasia Group, maintains that there will not be any deeper sanctions to halt the energy deal.

Japan currently buys 65 percent of the natural gas reserves in Russia’s Sakhalin-2. The Sakhalin facility is favored due to its proximity to Hokkaido, and provides 9.5 percent of Japan’s natural gas.

The new restrictive sanctions have been created due to the U.S and the E.U. aims to isolate the Russian economy. Russian president Vladimir Putin’s support for the eastern Ukraine separatists is what has prompted this action.

The sanction will freeze all assets that are linked to the Russian involvement in Ukraine. Japan will also restrict their exports made to Crimea.

Yoshiki Mine, a former Japanese diplomat, said that Japan is not enthusiastic about the sanctions. It has been imposed to show that Japan wants to strengthen its ties with the West, while still keeping and opening with Russia. The move also comes at a time when Japan’s relations with China and South Korea continue to weaken.

Russia has not declined the sanctions, while Putin’s scheduled visit to Japan regarding the energy deal has yet to be commented on by Russian officials.