Malaysia rises as Asean ‘middle power’ through new Japan LNG deal

Japan ’s signing of a 20-year LNG supply deal with Malaysia’s Petronas has cast the Southeast Asian country as a valuable energy and security partner, as Tokyo looks to protect itself from global supply shocks and deepen ties with trusted allies. The latest move also underscores how, amid the energy crisis, Asian nations are striking deals bilaterally, with Malaysia leveraging its vast natural resources to rise as a “middle power”, according to analysts. Under the agreement announced during Malaysian Prime Minister Anwar Ibrahim ’s visit to Tokyo on Wednesday, the state-owned energy company will supply Japanese utility JERA with 2 million tonnes of liquefied natural gas annually from 2028. Japan currently imports 15 per cent of its LNG from Malaysia, its second-largest supplier behind Australia. Malaysia’s reliability as an energy supplier has become more important for Japan as it seeks to manage exposure to supply routes such as the Strait of Hormuz, which accounts for about 6 per cent of its LNG imports. The prime ministers of Japan Sanae Takaichi (right) and Malaysia Anwar Ibrahim (left) attend a bilateral meeting at the Prime Minister’s Office in Tokyo on Wednesday. Photo: EPA At the meeting, Anwar said Malaysia was committed to promoting open and stable trade with Japan, including for essential energy supplies such as LNG, as well as petroleum and chemical products such as naphtha and urea.