Japan's embrace of Russia under threat with Ukraine crisis
(Reuters) - Russia's incursion into Ukraine is setting off alarm bells in Tokyo, where officials worry that any push by Japan's Western allies to impose economic penalties will undermine its drive to improve relations with Moscow.
While U.S. President Barack Obama and other G7 leaders of advanced economies talk of sanctions or other punitive responses, Japanese officials say ties with Moscow remain on track.
There has been no change in the direction of economic and resource diplomacy between Japan and Russia, Trade Minister Toshimitsu Motegi said on Tuesday.
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A dramatic transformation is under way in Russia's energy sector, with oil flows being redirected to Asia via the East Siberia-Pacific Ocean pipeline and Putin pushing for more gas sales to reduce Moscow's reliance on Europe.
Japan now consumes a third of global liquefied natural gas (LNG) shipments, and purchased 10 percent of its supplies from Russia's east, which lies on Japan's doorstep.
Oil imports from Russia rose almost 45 percent in 2013 and accounted for about 7 percent of supplies to the world's fourth-biggest crude importer.
With all the country's nuclear reactors shut down and no timetable for restarts, Tokyo is desperate to diversify and slash costs of energy imports and Japanese companies are involved in projects to export more gas in liquid form.
"A worsening relationship between the US and EU with Russia may damage Japan's ongoing improved dialogue with its closest neighbour if economic, trade, or banking sanctions follow," said Tom O'Sullivan, founder of Independent energy consultancy Mathyos Japan.
"This could impact Japan's gas and oil imports from Russia as well as investments in upstream energy assets at a time when Japan's energy security is still threatened due to the continued closure of all of its nuclear power plants."
http://uk.reuters.com/article/2014/03/04/uk-ukraine-crisis-japan-idUKBREA230TK20140304