A new report from the International Energy Agency reveals that disruptions to shipping in the Strait of Hormuz have caused Japan's average wholesale electricity spot price to reach $90 per 1,000 kilowatt-hours in the second quarter of this year, marking a roughly 30% increase compared to the same period last year.

The report attributes this price surge to the halt in liquefied natural gas (LNG) supply from the Middle East, which was triggered by the blocked shipping route in the Strait of Hormuz.

The agency warns that electricity prices are likely to continue their upward trend, driven by increased demand during the hot summer months and the prolonged nature of the shipping blockade.

Looking ahead, the IEA forecasts that Japan's average wholesale electricity price will climb to $105 per 1,000 kilowatt-hours in the second half of 2026, representing a year-on-year increase of approximately 40%.

According to data from Japan's Agency for Natural Resources and Energy, thermal power generation fueled by LNG accounts for about 30% of the country's total electricity output, making domestic power prices highly sensitive to fluctuations in the international LNG market.