Japan, US reaffirm East China Sea security ties

Market: Crude oil, Natural gas
24/01/22

Japan and the US have reaffirmed their co-operation commitment to boost security for issues surrounding the Diaoyu, or Senkaku, islands south of the East China Sea, an area where ownership of oil and gas reserves is hotly contested by Beijing.

Japanese prime minister Fumio Kishida and US President Joe Biden agreed to push back against China's attempts to change the status quo in the East China Sea and South China Sea, during a 21 January virtual meeting to discuss wider geopolitical issues. Biden underlined the US' commitment to defending Japan using its full range of capabilities.

The uninhabited islands, known as the Diaoyu in China and Senkaku in Japan, are controlled by Japan but have been repeatedly disrupted by China and Taiwan since 1971. The area has been becoming a strategically important location after the UN noted the possibility of oil reserves in 1969.

China has intensified its maritime activity near the Senkaku islands. The Japan Coast Guard for the first time this year detected four Chinese coast guard vessels operating in Japanese waters around the Senkaku islands on 15 January. It has observed a daily average of four such ships in the contiguous zone just outside Japanese territorial waters during 1-20 January.

Policy advisers for the Japanese prime minister's office previously warned of possible future disruptions to tanker traffic in the key Asian sea lane with regional tensions surrounding China's growing maritime presence in the East and South China Seas. They recommended that the government secure an alternative route to ensure its oil and LNG imports.

Japan heavily relies on crude imports from the Middle East, which accounted for 92pc of its total 2.4mn b/d of imports during January-November 2021. The bulk of the supplies cross the strait of Malacca, travels through the South China Sea and either the Taiwan strait or Bashi channel before arriving in Japan. The country also imported 11mn t, or 16.5pc of its total LNG supplies, from the Middle East during the period.

Kishida and Biden further agreed to deepen economic co-operation with Australia, India, southeast Asia and Europe towards realising a free and open Indo-Pacific region. Kishida expressed his intention to host a Japan-Australia-India-US, the so-called Quad grouping, summit meeting in Japan in the first half of this year by inviting Biden to Japan.

By Motoko Hasegawa

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