Japan Eyes Coal Boost Amid LNG Supply Disruptions from Middle East War

TOKYO - Japan’s Ministry of Economy, Trade and Industry will propose lifting its 50% cap on coal-fired power plant utilization for one year, citing supply risks to liquefied natural gas (LNG) caused by the U.S.-Israeli conflict with Iran.

The war has effectively closed the Strait of Hormuz, a critical route for about 4 million metric tons of Japan’s annual LNG imports-roughly 6% of its total. Reducing LNG dependence via increased coal use could cut Hormuz-sourced LNG consumption by more than 10%, or roughly 0.5 million tons annually.

Japan maintains an LNG reserve of approximately 4 million tons. Its thermal power mix relies heavily on LNG and coal, with minor oil contributions. Approval timing for the proposal remains unclear, though a related announcement from the prime minister is expected soon.