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Japan cuts gas in favour of coal as Hormuz disruption chokes LNG

Japan reduced natural gas-fired power generation last month after disruptions around the Strait of Hormuz tightened LNG supply, switching more electricity generation to coal.

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William Bills

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Japan cuts gas in favour of coal as Hormuz disruption chokes LNG

Japan sharply cut back gas-fired electricity generation in June and relied more on coal as disruptions around the Strait of Hormuz tightened supplies of LNG, according to data compiled by the country’s nine largest utilities and reported by Bloomberg.

The utilities produced about 17.3 terawatt-hours of electricity with gas in June, down 16% year-on-year. Coal generation rose 4.6% over the same period. The shift underscores how quickly disturbances near a major maritime chokepoint can affect cleaner-fuel availability and push utilities toward higher-emissions alternatives.

Japan, the world’s second-largest LNG buyer, has also reduced LNG imports since the war in the Middle East escalated. March-to-June imports were down about 7% compared with the same period last year, using ship-tracking data.

The report links the price and supply pressure on LNG to the broader disruption of Middle East exports, noting that LNG spot prices in Asia are about 70% higher than pre-war levels, making gas less attractive to Japanese power producers.

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