Japan and the United States are close to an agreement on cuts in Japanese imports of Iranian oil that will allow Tokyo to avoid US sanctions, and may conclude a deal this month, Japanese Foreign Minister Koichiro Gemba told Reuters Monday. But Gemba said the two sides might not make public the size of the cuts because of the possible impact on markets. “We are in the final stage, but are still making final adjustments (to an agreement),” Gemba said in an interview. “Certainly, we will reduce (the imports), but because the concrete figures would influence the market, I am thinking at this point that it would be better not to announce them.” Japan's government has previously said the country would likely be spared from the US sanctions, aimed at pushing Tehran to curb its nuclear ambitions, and has cut its Iranian oil imports by 40 percent over the past five years. The pressure to cut Iranian imports comes as Japan is boosting overall fossil fuel imports in the wake of the nuclear disaster at Fukushima atomic plant last March. All but two of the country's 54 nuclear reactors are off-line, mostly for checks and maintenance. About 85 percent of Japan's oil imports and 20 percent of its LNG imports travel through the Strait of Hormuz, Gemba noted, but said that if Iran blockaded the crucial shipping lane, Japan could keep the economic impact on the country to a minimum because it has ample reserves. “Even in the worst case, naturally we would consider (measures) including the release of reserves to keep the impact on the Japanese economy and people living in Japan to a minimum,” he said.
