Per Japanese government instructions, refiner Taiyo Oil has bought a cargo of Russia’s Sakhalin crude to ensure stable production of the LNG plant that supplies gas to Japan, a company spokesperson told Reuters on Tuesday.
“At the request of the Ministry of Economy, Trade and Industry, we have decided to take delivery of 600,000 barrels of Sakhalin Blend crude oil,” the spokesperson for Taiyo Oil said.
Japan stopped importing crude oil from Russia in early 2023, but it has a special waiver from the United States – currently expiring on June 28, 2025 – to import crude from the Sakhalin-2 project.
The U.S. Treasury’s Office of Foreign Assets Control (OFAC) has authorized the maritime transport of crude oil originating from the Sakhalin-2 project (Sakhalin-2 byproduct) through 12:01 a.m. eastern daylight time, June 28, 2025, provided that the Sakalin-2 byproduct is solely for importation into Japan.
Japan buys LNG from the Sakhalin project, where oil is a byproduct of gas output.
Earlier this year, the Japanese authorities asked refiners to consider importing Sakhalin Blend crude to ensure that the LNG plant operates smoothly and delivers LNG to Japan.
Now Taiyo Oil has bought a Sakhalin cargo and “This decision was made to help ensure a stable energy or LNG supply to Japan,” the company spokesperson told Reuters.
The crude was delivered on a tanker that has been blacklisted by both the U.S. and the EU, but since Sakhalin-2 byproduct crude imports are exempted from sanctions by June 28, the shipment was allowed and there will not be any repercussions for the Japanese refiner. The EU doesn’t have secondary sanctions that would affect entities in third countries sdealing with blacklisted tankers.
The Aframax tanker Voyager shipped the Sakhalin Blend crude to the Japanese port of Kikuma. The vessel arrived on Monday and left after discharging its cargo, according to LSEG shipping data cited by Reuters.
By Charles Kennedy for Oilprice.com
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