Comment by alephnerd

> As a result of the Takaichi administration directing subsidies exclusively toward gasoline, oil companies have stopped prioritizing naphtha production

Not exactly. Japan only produces around 40% of it's naphtha domestically, with 40% from the Middle East and the other 20% from other sources. Much of the pain arose from supply shock for the 40% sources from the ME.

That said, much of the pain around naphata is transitional, as most Japanese imports of naphtha have now shifted away from the Middle East to Algeria, the US, and India [0][1].

Mind you, this is eating significantly into margins, but it is survivable as this isn't Japan's first black swan event of similar calibre - the late 2000s and early 2010s oil price shock occurred during a much more difficult macro environment for Japan, and at least according to ONG analysts [2] (behind login, as most actionable commodities news is) Japan has the reserves needed for around a year of production assuming Japan didn't begin shifting sourcing, which it did.

I'd recommend reading Overseas Energy Investment of Korea and Japan: How did Two East Asian Resources-Rare Industrial Giants Respond to Energy Security Challenges by Oh Seong-ik [3] to learn more about the Korean and Japanese energy security policy - both are using the same methodology, strategies, and contract structures, and despite public rhetoric, a large portion of younger Koreans targeting the Blue House and/or high finance still try to attend Waseda for their undergrad if SKY, KAIST, or Ewha doesn't work out.

[0] - https://asia.nikkei.com/spotlight/iran-tensions/iran-war/jap...

[1] - https://www.argusmedia.com/en/news-and-insights/latest-marke...

[2] - https://direct.argusmedia.com/newsandanalysis/article/280064...

[3] - https://link.springer.com/book/10.1007/978-981-99-0285-9