Japanese oil company Idemitsu Kosan unveiled a new medium-term strategic plan with a strong focus on fossil fuels, marking a shift from its previous energy transition goals. The company will invest 1.8 trillion yen, equivalent to approximately $11.4 billion, by 2030.
Of that amount, approximately 830 billion yen will be allocated to strengthening existing businesses linked to oil and refining, a decision that reflects growing concerns about energy security and the stability of global supply.
Idemitsu redefines its strategy and prioritizes oil and gas
The new approach represents a significant change from Idemitsu’s previous plan, which sought to reduce assets associated with fossil fuels and increase the weight of non-oil businesses before fiscal year 2030.
According to the company’s president, Noriaki Sakai, the forecasts for a sustained reduction in hydrocarbon consumption have become less clear due to the geopolitical scenario and the volatility of the international energy market.
Sakai also noted that the company had abandoned its previous goal of reducing Japan’s domestic refining capacity, arguing that products such as fuel oil continue to be of strategic importance to the country’s economy and energy security.
Japan seeks to reduce risks to crude oil supply
Idemitsu’s reshuffle also responds to tensions in the Middle East and logistical problems stemming from the effective closure of the Strait of Hormuz following the conflict with Iran.
Before the crisis, Japan obtained about 95% of its crude oil imports from that region. Faced with this scenario, the company began to secure supplies from North and South America, in addition to maintaining purchases from Saudi Arabia and the United Arab Emirates through alternative routes.
The company stated that it is not currently facing extreme difficulties in obtaining alternative oil, although it maintains priority over domestic Japanese supply even when international markets offer better profit margins.
Oil and gas are gaining ground in the energy strategy
Idemitsu’s move aligns with a broader trend within the global energy industry. Several companies that had accelerated their climate strategies in recent years are now reinforcing their oil and gas operations due to the sector’s increased profitability.
Fossil fuel prices recovered significantly after the lows recorded during the COVID-19 pandemic, promoting new investments in exploration, production and marketing of liquefied natural gas.
In the case of Idemitsu, part of the planned investment for the period 2026-2030 will be directed towards growth and decarbonization projects linked to the upstream natural gas business and the international trade of LNG.
Idemitsu projects greater profits by 2030
Within its financial forecasts, the company expects to achieve a pre-tax profit of 360 billion yen for fiscal year 2030.
The figure far exceeds the 244 billion yen recorded as operating profit and equity gains during the fiscal year 2025 ended in March.
Likewise, the company confirmed that it will continue to prioritize the stability of Japan’s energy supply amid an international environment marked by geopolitical uncertainty and pressure on global oil and gas supply chains.
Source: Reuters
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