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Global LNG supply is slated to remain tight for years. Image Credit: Shutterstock

Tokyo: Japan agreed to purchase more liquefied natural gas from the US and Oman in the latest move to secure fuel supplies and avoid future shortages.

The deals come as Japan’s government is reevaluating how it can enhance energy security in the face of a fuel crunch at home. Global LNG supply is slated to remain tight for years, which threatens to increase import costs and add to rising inflation.

This also marks a shift for Japanese LNG importers, which had been moving away from long-term deals on the expectation that the transition to cleaner energy sources would reduce gas demand this decade. Companies were instead increasing dependence on the short-term spot market to secure LNG supplies.

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However, with the spot market tight and prices near a record high, Japanese companies are now reversing course and locking in supply for years at more attractive rates.

A Mitsui spokesperson said the trading company was involved in the deal reported by NHK, but declined to comment further. A spokesperson for Itochu declined to give details in an emailed comment, but said the firm will continue negotiations on long-term contracts for LNG with Oman to support Japan’s energy security.

Jera plans to make an announcement later Tuesday, spokesperson Hiroyuki Usami said, declining to give further details of the contract.