Foreign Policy Research Institute A Nation Must Think Before it Acts Under Pressure: Russian Energy Cooperation with Japan and South Korea since Western Sanctions
Under Pressure: Russian Energy Cooperation with Japan and South Korea since Western Sanctions

Under Pressure: Russian Energy Cooperation with Japan and South Korea since Western Sanctions

Download Under Pressure: Russian Energy Cooperation with Japan and South Korea since Western Sanctions

Executive Summary

This report will examine Russian-Japanese and Russian-South Korean energy cooperation. Neither Japan nor the Republic of Korea imposed energy sanctions on the Russian Federation, and both U.S. allies continue to expand their energy deals despite Western sanctions. In the framework of Prime Minister Shinzō Abe’s eight-point economic cooperation plan and President Moon Jae-in’s Nine-Bridges initiative, Japanese and South Korean companies actively participate in Russia’s ambitious energy projects, such as Yamal LNG, Arctic LNG-2, and projects on Sakhalin Island. As U.S. sanctions expand further, intensifying energy relations will put Japanese and South Korean companies in the line of fire.

Looking at existing and planned joint energy projects, this report will analyze the countries’ rationale for deepening cooperation. It will then examine how Japanese and South Korean energy companies adapt to Western sanctions—in particular to U.S. secondary sanctions—and highlight the strategies that companies use to navigate sanctions’ loopholes. Finally, it will assess potential challenges for energy cooperation stemming from additional U.S. sanctions, Russia’s import substitution policy, and China’s growing energy demand.

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