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Japan's trade deficit narrows as lower oil prices reduce imports

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Geez talk about timing...first the closing of the reactors announcement, then this. Next will be an announcement about restarting other reactors I'll bet.

-2 ( +0 / -2 )

shipments to China fell more than 17% as the economy there slowed.

what about record number of Chinese Tourists buying at Tax-Free shops...and tv channels were running special shows about their purchasing power ? NO, didn't help much !

0 ( +1 / -1 )

"In yen terms, vehicle and machinery exports rose..."

Key phrase is "in (aggressively devalued) yen terms.

0 ( +1 / -1 )

Many tend to underestimate what an effect the world price of oil had on Japan's economy (whether you like Abenomics or not) this has helped Japan with its huge energy imprts.

4 ( +4 / -0 )

So if there is lower oil costs why doesn't this reflect at the pump?

2 ( +2 / -0 )

gogogo,

I thought precisely the same thing. Moreover, with crude oil prices continuing to fall, why have gasoline prices in the Kanto area begun creeping upward from a low of 117 yen/liter a month ago to an average of 128 yen/liter now?

No price fixing in the energy sector, they say? Horse puckey.

3 ( +3 / -0 )

"So if there is lower oil costs why doesn't this reflect at the pump?"

Largely because you are thinking in yen terms(which has been greatly devalued) whereas oil is priced in USD(PetroDollar). Plus, taxes!

-3 ( +2 / -5 )

So if there is lower oil costs why doesn't this reflect at the pump?

Refineries might be backlogged. Or the cheap oil hasn't filtered out to the market yet. Depending on the actual operational details, there might be a significant time delay before the cheaper oil is physically delivered to Japan.

-3 ( +1 / -4 )

Refineries might be backlogged. Or the cheap oil hasn't filtered out to the market yet.

These explanations have been offered in the past to explain obvious discrepancies between world market prices for crude and prices at the pump, however, they don't apply whatsoever in this situation.

The cheaper gasoline prices were already delivered to Japan in the tail end of December. Gasoline was sitting at 140~160 yen/liter for the better part of a two years when the price of crude started dropping then. When that drop occurred, the price at the pump started dropping almost immediately after, just as one would expect in an economic model in which "market forces" are supposedly allowed to (and allegedly encouraged) to play.

The price at the pump went as low at 117 yen/liter before inexplicably going up by almost 2 yen per day sometime in February. It now sits at and average of 129 yen/liter across Kanto while news sources continue to widely report the continuing spiral of crude prices and OPEC's unchanged stance about cutting crude production to shore those prices up.

In short, something stinks.

Largely because you are thinking in yen terms(which has been greatly devalued) whereas oil is priced in USD(PetroDollar).

Umm.... No, no, oh, for the love of Pete, no.

3 ( +4 / -1 )

"the recovery of the U.S. economy"

This is bad news for whoever becomes the Republican presidential nominee..

-1 ( +0 / -1 )

while exports fell from the month before with a sharp drop in export volumes, Marcel Thieliant of Capital Economics said in a commentary.

“Net trade should therefore become a drag on GDP growth soon,” he said.

More bad news for Abenomics. Even with a cheap yen, exports declined. The "third arrow" needs to come fast, because, as these numbers indicate, an export-focused economic strategy is too much subject to factors Japan cannot control, like a slow-down in the Chinese economy. The domestic economy needs to get humming -- fast.

0 ( +2 / -2 )

Oil import will further decrease. 5 Power Utility Companies are no longer accepting energy from solar because of over capacity at noon time. And now, this year, Japan will apply comprehensively the NAS BATTERY technology and probably the next-gen Lithium-Ion battery used in cars to store large percentage of the energy from solar while there is sunlight (variable energy will be given to the grid real time and be controlled accordingly.

Japan is the world's top-caliber in NAS Battery and can store dozens (to a hundred) of MW of energy for 6 to 8 hours gradual re-supply to the grid. This will be the day when oil price will never go up again. In the long run, will narrow down trade deficit of Japan.

0 ( +0 / -0 )

Japan's trade deficit narrows as lower oil prices reduce imports

Headline or, worse yet, failure to understand how economics works, fail.

Lower oil prices would tend to increase the import of oil (in order to increase reserves at the lower price) and lower the cost of goods in general, as long as the price of oil stayed lower for a quarter's worth of economic data. Otherwise, imports should increase, but the lower cost might balance out import-export in monetary terms.

1 ( +2 / -1 )

To those asking about why prices haven't come down.

One, prices in Japan include a 48.6 yen tax per litre.

Two, transport and refining costs are in the price.

The commodity price is only something like 20-40% of the total price, as I recall.

Your comment was not posted because it contains potentially offensive content.

Moderators - you really need to fix this message. I have no idea what words I am using that triggers this.

0 ( +0 / -0 )

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