Japan is completing steps to launch a derivatives market for Liquefied Natural Gas (LNG). While oil has long been traded in both spot and future markets, LNG remains very much the province of long-term fixed-price contracts. Japan is one of the biggest consumers, accounting for some 40% of world imports.
Recent news from Southeast Asia has been dominated by maritime conflicts, and then trade negotiations in second place. However, nature has once again reminded us all that it is not just conflicts among nations that threaten the life and property of citizens. The reminder has come in the shape of a terrible typhoon, known as Haiyan or Yolanda.
Threats to humankind do not only come from within, and while it may still sound like science fiction to many, the possibility of a sizable asteroid impacting Earth remains a major concern for the space and national security communities. Japanese astronaut Soichi Noguchi recently reminded the public of this fact, and furthermore called for an international effort to detect and deflect incoming celestial bodies. Given the advanced capabilities of the Russian space program, Moscow would be a much welcome partner in such an enterprise.
Canada is one of those countries whose relations with Japan seldom prompt front page news. However, in addition to sharing some key interests, certain developments may help the relationship grow tighter over the coming years. These include energy, a field where Ottawa is a major player and Tokyo is in the midst of a major overhaul. The two countries are also taking steps in security and defense cooperation.
In the midst of Japan’s energy woes, prompted by the Fukushima disaster and reinforced by the uncertainty arising from the tensions in East Asia, the arrival for the first time of a Liquefied Natural Gas (LNG) tanker through the Arctic Ocean and into the Pacific Ocean offers hope and the chance to diversify away from the sea lanes Tokyo currently relies upon for the bulk of its energy imports. This is possible thanks to the gradual melting of Arctic Ocean ice, technological developments, and Russia’s policy of energy export diversification.
The long string of incidents off the Senkaku-Diaoyu Islands this summer and the wider maritime territorial disputes in East and Southeast Asia have been overshadowing a major development with great potential implications for Japan: The northern sea route, linking East Asia with Europe through waters traditionally closed by ice to commercial navigation, are increasingly accessible during the Arctic summer thanks to the global warming.