Economy

Average Gasoline Price in Japan Drops below ¥170; Government Subsidy Funds Could Run Out in 2 Months

The Yomiuri Shimbun

14:21 JST, April 9, 2026

The average retail price of regular gasoline across Japan fell to ¥167.40 per liter as of Monday, down ¥2.80 from the previous week, the Agency for Natural Resources and Energy has announced.

This marks the first time in about a month that the price has dropped below ¥170, largely due to the effects of government subsidies reinstated in mid-March following a surge in crude oil prices.

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Prices have now gone down for three consecutive weeks. The decline is believed to stem from the fact that gas stations have used up the supply they purchased before the start of the subsidies, so the discounts are now being reflected in retail prices.

The government set the subsidy for oil wholesalers at ¥48.8 per liter for the period from April 9 to 15. Although this is ¥1.0 lower than the period from April 2 to 8, it remains at the highest level since the subsidy program began in January 2022.

The amount is adjusted based on projected market rates to keep retail prices at about ¥170. Equal subsidies are also being applied to diesel and kerosene.

To fund the program, the government added ¥800 billion from the fiscal 2025 reserve funds to an expected existing balance of about ¥280 billion as of the end of March, securing a total of over ¥1 trillion. However, if the current subsidies of nearly ¥50 per liter continue, these funds could be exhausted in about two months.

Crude oil prices plunged after U.S. President Donald Trump announced a halt to attacks on Iran, but they remain high. The outlook for the market remains uncertain, as it is unclear whether the United States and Iran can reach a final agreement to end hostilities.

Prime Minister Sanae Takaichi said Tuesday that the government may tap into the fiscal 2026 reserve funds to continue the subsidy program. “We will continue to closely monitor the impact of the situation in the Middle East on the economy and will take necessary measures without hesitation,” Takaichi said.