Crude Oil Prices Top $100: Measures Must Be Taken Before It’s Too Late

Editorial

13:59 JST, March 10, 2026

Crude oil prices have topped $100 due to escalating tensions in Iran. If high oil prices persist for a long time, it will have a severe impact on the Japanese economy. The government must take countermeasures before it is too late.

The benchmark U.S. crude oil futures price surged Sunday, briefly going above $119 per barrel. This marks the first time the price has exceeded $100 since July 2022, after the outbreak of the Ukraine crisis. Some market observers believe prices could break the all-time high of $147 recorded in July 2008.

In the Japanese market, stocks, the yen and bonds all fell on Monday, with the Nikkei Stock Average cratering by as much as 4,200 points. Uncertainty about the economic outlook is increasing rapidly.

This concern is accelerating inflation. High crude oil prices push up electricity and shipping costs, which are then passed on to food prices. Prices will also rise for plastic products, detergents, packaging materials and other goods made directly from crude oil.

Consumer sentiment could cool rapidly, and this must be avoided.

“We began examining this early last week. We will implement countermeasures without delay,” said Prime Minister Sanae Takaichi at the House of Representatives Budget Committee, referring to the sharp rise in crude oil prices. The government should closely monitor trends in the crude oil market and implement effective measures.

Should high crude oil prices persist, subsidizing electricity and gas bills will likely become an issue. Current subsidies are set to expire starting with the bills people will receive in April.

The price of liquefied natural gas (LNG), which is used at many thermal power plants, is basically tied to crude oil prices. It is highly likely that household electricity and gas rates will increase starting this summer.

A potential surge in gasoline prices may also have to be addressed. In 2023, gasoline prices hit a record high in the mid-¥180 range, prompting government subsidies.

The provisional surcharge on the gasoline tax was abolished late last year, and prices were in the upper ¥150 range per liter late last month. However, some forecasts predict gasoline prices could exceed ¥200 if tensions in Iran persist.

The question of how oil reserves should be used may also require attention. Having learned from the 1970s oil crisis, Japan maintains 254 days’ worth of oil in a reserve in case of potential supply disruptions.

Specifically, the government holds 146 days’ worth of oil imports, or 41.12 million kiloliters, while the private sector holds inventories equivalent to 101 days of domestic consumption, or 28.48 million kiloliters. Additionally, there is seven days’ worth of oil held in a joint reserve with oil-producing nations.

The Group of Seven nations are considering a coordinated release of reserve oil. Japan, recognizing the importance of international cooperation, should strive for shared understanding.

(From The Yomiuri Shimbun, March 10, 2026)