Japan's gas demand may fall if Iran war hits plastics supply, gas companies say

By Yuka Obayashi and Katya Golubkova

TOKYO, March 25 (Reuters) - Japan's gas demand may fall if the war on Iran continues to curb naphtha supply to petrochemical plants and hits their sales of resins including plastics to a range of manufacturers, gas company chiefs said on Wednesday.

Osaka Gas 9532.T supplies gas to factories, and if those plants are forced to cut production because of a shortage of basic materials, the company's gas sales will drop, Osaka Gas President Masataka Fujiwara said at a briefing.

"There will be an impact if our customers are unable to manufacture," he said.

Tokyo Gas 9531.T similarly warned of the potential fallout from a shortage of naphtha for manufacturers.

“As we have a number of customers who use naphtha or other petroleum products in their manufacturing operations, any move to scale back their activities or operations could have an impact on our gas sales,” Tokyo Gas President Shinichi Sasayama said at a separate press conference.

So far, he said, no immediate impact has been seen.

Japan gets around 6% of its liquefied natural gas supplies via the Strait of Hormuz, which is blocked due to the U.S.-Israeli war on Iran. Around 90% of Japan's oil needs also used to pass the narrow strait before the conflict broke out at the end of February.

Fujiwara said Osaka Gas, one of Japan's biggest LNG importers along with JERA and Tokyo Gas 9531.T, has secured sufficient fuel supplies for its operations, with most of its LNG coming from Australia and the United States.

"We secure the majority of LNG through long-term contracts, and there are currently no long-term contracts for LNG procurement via the Strait of Hormuz," he said, adding that a term contract with Oman expired last year.

LNG imports by Japan, the world's second-biggest buyer after China, fell 1.4% in 2025 from a year earlier to 64.98 million metric tons, with the country restarting nuclear power plants, rolling out renewable energy and boosting energy efficiency.

LNG stockpiles held by major Japanese utilities rose to 2.39 million tons for the week ended on March 22, industry ministry data showed on Wednesday, up 5% from a week earlier to its highest so far this year.