Japan to Keep Pump Price Target at around 170 Yen

Tokyo, Aug. 25 (Jiji Press)–The Japanese government will continue measures to keep retail prices of regular gasoline at around 170 yen per liter amid ongoing instability in the Middle East, Prime Minister Sanae Takaichi said Tuesday. Takaichi told reporters that she has instructed industry minister Ryosei Akazawa to consult with Finance Minister Satsuki Katayama to secure necessary funds. “The situation in the Middle East remains uncertain, and it is difficult to predict crude oil prices,” the prime minister said. “We will minimize the impact on people’s lives and economic activities for now.” To secure additional financial resources, the government plans to tap into a 2.5-trillion-yen reserve fund for responding to the situation in the Middle East, which was allocated in the fiscal 2026 supplementary budget enacted in June. As of the end of July, the balance of the fund for gasoline subsidies had fallen to about 210 billion yen. The government had previously planned to raise the gasoline price target above around 170 yen as part of a review of the subsidy program, aiming to avoid continuing gasoline subsidies indefinitely amid the prolonged turmoil in the Middle East. “We will flexibly consider how to provide support, including an eventual exit from the (subsidy) program, while closely monitoring the impact of the Middle Eastern situation on future price trends and the economy,” Takaichi said. The government launched gasoline subsidies in January 2022. The subsidy program temporarily ended at the end of December last year with the abolition of the provisional gasoline tax rate but resumed in March this year. The cumulative cost for gasoline subsidies has swelled to about 9 trillion yen. END [Copyright The Jiji Press, Ltd.]