Japan is reportedly in the final stages of discussions with the United States Department of the Treasury to extend an exemption that allows companies to continue handling transactions linked to the Sakhalin 2 oil and gas project in Russia’s Far East, where Japanese firms hold stakes.
With the current waiver set to expire on June 18, the move is intended to secure ongoing imports of crude oil and liquefied natural gas. The move comes as shipments from the Middle East to Japan have sharply declined due to a de facto blockade of the Strait of Hormuz.
Japan is considering alternative routes to the Strait of Hormuz and seeking energy sources beyond the Middle East, while still regarding imports from the Sakhalin-2 project as essential for maintaining a stable energy supply.
In November 2024, the U.S. Treasury imposed restrictions on transactions involving Gazprombank, a financial institution linked to Russia’s state-owned energy company Gazprom, as part of sanctions imposed on Moscow over its ongoing war in Ukraine.
Transactions linked to Sakhalin-2 are mainly processed through Gazprombank. When sanctions disrupted these dealings, the Japanese government repeatedly requested exemptions, which were approved by the United States. The current waiver is valid for six months starting from December 2025.
Gazprom owns more than 70% of the Sakhalin-2 project, while Mitsui & Company holds a 12.5% stake, and Mitsubishi Corporation owns 10%.
LNG from the Sakhalin-2 project made up 8.9% of Japan’s total LNG imports in 2025. In May, a tanker carrying crude oil from the project docked at a Japanese port for the first time since the security situation in the Middle East worsened.
The United States and Europe have continued adjusting sanctions on Russia amid rising crude oil prices. In May, the United Kingdom also allowed imports of petroleum products refined in third countries using Russian crude oil and also permitted the shipment of LNG from Sakhalin-2 to third countries.
Meanwhile, the United States has temporarily permitted certain countries to purchase Russian crude oil.
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