Tsutomu Sugimori, the President of the Petroleum Association of Japan (PAJ), on Thursday, said that domestic oil refiners might speed up efforts to use more renewable energy and produce cleaner fuels such as hydrogen if the government sets a more ambitious goal to cut emissions to zero by 2050. Nikkei reported on Wednesday that Tokyo is set to announce a target to cut greenhouse gas emissions to net-zero by 2050 next week.
Sugimori, who also heads Japan’s biggest oil refiner Eneos Holdings, noted domestic gasoline demand is gradually recovering from a slump caused by the coronavirus pandemic. However, demand is expected to be on a downtrend in the long term because of a shrinking and aging population. Sugimori added the long-term downtrend could accelerate due to the pandemic, prompting refiners to evaluate their production capacity and structure.
Sugimori also noted that the current domestic kerosene output and a continuing inventory build might reduce Japan’s needs to import in the winter, depending on temperatures. Last year, Eneos revealed its long-term strategy, which assumes that Japan’s oil demand would halve by 2040 or fall 2% every year.
