Japan oil sector: Points to watch in Apr-Jun 2026 results

Research evidence excerpt

Japan oil sector: Points to watch in Apr-Jun 2026 results

Japan oil sector: Points to watch in Apr–Jun 2026 Global Markets Research

results 8 July 2026

EQUITY: JAPAN OIL PRODUCTS

We expect oil refining companies to report profit Research Analysts

growth on inventory valuation gains Japan utilities & oil Shinichi Yamazaki - NSC

Concerns about oversupply putting downward pressure on crude oil shinichi.yamazaki.a3@nomura.com

prices +81 3 6703 1133

Apr–Jun business conditions: Higher crude oil price, weaker yen than a year earlier

likely affected earnings

We estimate that profits increased at oil refining companies in 27/3 Q1 on higher

petroleum product margins and inventory valuation gains stemming from higher crude oil

prices and yen depreciation. The Dubai crude oil price was around $97/bbl in Q1, below

oil refining companies' Q1 crude oil price assumptions ($100/bbl for Idemitsu Kosan

[5019] and $110/bbl for ENEOS Holdings [5020] and Cosmo Energy Holdings [5021]).

Petroleum product margins have been gradually narrowing since peaking in March, when

there was a positive time-lag effect from the sharp rise in crude oil prices, but look to have

widened y-y in the Apr–Jun quarter, albeit with a negative time-lag effect from the decline

in crude oil prices since mid-June. We see upside versus Apr–Jun 2026 guidance for

profits attributable to owners of the parent at oil exploration & development companies

Inpex [1605] and Japan Petroleum Exploration [1662] because of higher crude oil prices

and the weaker yen.

Points to watch in Apr–Jun results announcements: Crude oil output in Middle East

Crude oil output in the Middle East has been falling since the Strait of Hormuz was closed.

Crude oil output in June was around 60% of the February (pre-war) level. Production has