Japan Weighs Phased Reduction of Gasoline Subsidies Starting in December Amid Fiscal Strain

Japan's government and ruling coalition are considering scaling back national gasoline subsidies starting in December due to mounting fiscal pressures and depleting reserves. Under the proposed phaseout, weekly support to distributors will taper, allowing retail gasoline prices to rise from roughly 170 yen ($1.09) per liter to 175 yen ($1.11) in December and 180 yen ($1.15) in January. The emergency relief program was implemented in March following Middle East geopolitical conflicts, but spending several billion dollars monthly has rapidly drained extra budget allocations of 3.1 trillion yen, or about $19 billion.