Japan's energy security at risk due to potential decline in LNG supply from Australia after election

Upcoming elections in Australia have raised concerns in Japan about possible changes in the countries' trade relations, particularly regarding the supply of liquefied natural gas (LNG). Asian companies fear losing a key exporter amid fuel shortages and soaring electricity prices, according to Reuters. 

Meanwhile, Australia’s Greens are actively promoting the idea of transitioning away from fossil fuels in favor of alternative energy sources. If the coalition comes to power, gas production and exports could be reduced, worsening Japan's energy issue.

Asian companies are under additional pressure because some of them own stakes in Australian gas projects. For instance, Japanese producer JERA last year acquired 15% of Scarborough LNG, located on the coast of Western Australia.

According to Kpler, Australia supplied Japan with 81 million tons of LNG in 2024, accounting for 40% of Japan's LNG imports. JERA, a key buyer of the fuel in the country, plans to diversify its suppliers to mitigate risks in case of a government change in Australia.