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37% of Japan firms cite oil volatility as top earnings risk

A Reuters poll found oil volatility leads other concerns, including currency swings and rising interest rates, while energy-intensive sectors face the most exposure.

Reported · Written up by our desk · Trade & Tariffs

Oil market volatility is the biggest earnings risk for Japanese companies, with 37% citing it as the top threat in a Reuters survey.

The poll listed currency swings and rising interest rates as other major concerns, and it also showed slightly more firms expect second-half profits to miss forecasts than beat them.

Reuters said the findings reflect Japan's sensitivity to the Iran war, given that nearly all of its crude imports come from the Middle East, so any disruption to Gulf shipping can feed into corporate costs and margins.

The survey noted energy-intensive sectors such as materials, chemicals, cement, and transport are most exposed if crude stays elevated, while higher fuel import bills add pressure on the yen.

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