Market share of crude oil

Petoleum market is not small though Japan is poor in natural resources!

Japan is poor in natural resources, imports most of the natural resources. Importing crude oil account 99.6% of total crude oil in Japan. However, the market size of petroleum is not small, about 28 trillion yen(about 280 billion dollars) in 2016 accorfing to the report of Ministry of Economy,Trade and Industry.

This market shriked in recent years because of Sophisticated Methods of Energy Supply Structures by Japanese government. Japanese government promoted conversion to nonfossil energy(new energy and nuclear energy).

In addition, this market is shrinking because eco-friendly cars and solar power spread for the last several decades. It is said that this market will continue to shirnk in the near future. Though the consumption of naphtha which is material of chemical products increase, other oil decrease in 2017. The consumption of gasoline decrease about 2%, heavy oil decrease about 10%.

There were 12 Japanese oil companies in 1990s, but there were five companies in 2010. Oil companies accelerate M&A after Nippon Oil Co and Mitsubishi Oil Co merged in 1999. Nippon Oil Co and Nippon Mining Holdings integrated operations in 2010. Recently, Idemitsu Kosan and Showa Shell agreed integrating operations in 2015, JX Holdings and Tonen General integrated operations in 2016. There are three groups now, JXTG(Nippon Oil Co and Nippon Mining Holdings), Idemitsu&ShowaShell and Cosmo Oil Co.

JXTG Holdings is the lagest oil company and has the top share of gasoline market in Japan. It account for over 50% of the petroleum market. Its sales in 2017 is about ten trillion yen. The second is Idemitsu, the thrid is Cosmo, the fourth is ShowaShell in the sales ranking of oil companies. In the gasoline share ranking, the first is JXTG, the second is ShowaShell, the third is Idemistu, the fourth is Cosmo.

Japanese oil compnies are proactive in entrying new energy business because oil will be exhausted 50years later. They seek for being a comprehensive energy company. The number of gas stations is decreasing from 1994 in Japan. They reduce costs by converting from full-service to self-service. In addition, some gas stations became composite facility with grocery stores, convenience stores or town offices.

By the way, there are some oil development companies in Japan though Japan is poor in natural resources. INPEX Co(INternational Petroleum EXploration Corporation) is the largest oil development company in Japan. Its sales is about 80 million yen in 2017, it is mid-sized enterprise among oil development companies in the world. The majority of its stock is held by Minister of Economy, Trade and Industry and JAPEX(Japan Petroleum Exploration Co). INPEX develops oil and LNG not only in Japan but also in Asia, Oceania, Latin America and more.

JXTG, Idemitsu, ShowaShell, Cosmo Oil, and INPEX are listed on the Tokyo Stock Exchange. Foreign investors can invest in JXTG, Idemitsu and INPEX on NYSE by ADR(American Depositary Receipt). In addition, they can do them through many ETFs, MAXIS Nikkei 225 ETF(NKY), iShares MSCI Japan ETF(EWJ), Wisdomtree Japan Hedged ETF(DXJ) and more.