While the people of Japan prepare to enjoy the annual Golden Week festivities in late April and early May, their leader is not so fortunate. Prime Minister Takaichi Sanae is making arrangements to visit Australia during her country’s national holiday to hold talks with her counterpart, Prime Minister Anthony Albanese.

Japanese government sources have told local media that Takaichi’s mission is intended to strengthen the “quasi-alliance” between the two countries. While it’s true Japan and Australia have been deepening military ties in recent years, the resumption of safe navigation through the Strait of Hormuz is expected to be top of the agenda – as both countries reel from the unfolding global fossil fuel crisis.

But there’s an elephant in the room.

As Australian households have been hit with higher energy bills and rising interest rates, Australia’s gas export industry has come under scrutiny for how little it contributes to the public purse. Pressure has been mounting on the Albanese government to intervene, which reached a crescendo in February when Australian Senator David Pocock extracted confirmation from officials that they were banking more revenue from the tax on beer than from a key gas tax, the Petroleum Resource Rent Tax.

The revelation sent a shockwave through the public. Australia is one of the world’s largest LNG exporters, and with the Strait of Hormuz’s recent de facto closure, Australian gas companies have seen their stocks rising. Now the Australian government is actively considering a range of reforms to capture more revenue from its gas exports. A flat 25 percent tax on gas export revenue is the model favored by a range of civil society groups, including the Australian Council of Trade Unions, which is a politically influential constituency within the governing Labor Party.

As Australia’s largest gas customer, Japan made its opposition to the reform immediately clear, when its ambassador in Canberra labeled the idea a “bad surprise.” Those familiar with the issue will know Japanese corporate and government actors have made interventions in Australian politics when they sense any shift in the status quo.

For these stakeholders, expanding gas production in Australia is critical – not for Japan’s own energy security but to meet the Japanese government’s explicit policy of cultivating LNG demand across Asia. Japan has recently faced increased scrutiny over its practice of reselling large amounts of Australian LNG. Between January 2023 and April 2025, 29 percent of Australian gas exports contracted by Japan went to other countries in Asia, while in the 2023-24 financial year Japanese corporations made an estimated $14 billion in profit from their gas-related business.

For this reason, Takaichi could seek to use her Australia visit to quash any notions of reforming the current arrangements, which appear to work in Japan’s favor. The Australian government is seemingly caught between addressing its immediate domestic energy woes, or satisfying Japan’s regional gas lock-in agenda.

However, as the knock-on effects of the Israeli-U.S. war on Iran continue to be felt by millions, other countries seeking to reduce their reliance on fossil fuels. That includes Australia’s third-largest gas consumer – South Korea.

Speaking at a town hall event on the island of Jeju, South Korea’s President Lee Jae Myung said the situation unfolding from the energy crisis was “worse than you think.” Warning that “our future will be at serious risk if we continue to rely on fossil fuels,” he said that South Korea “must move very quickly toward renewable energy.” Lee’s comments can only spell bad news for Australian gas companies.

Elsewhere in the region, similar trends are emerging among Japan and Australia’s trade and development partners.

In Vietnam, Vingroup has told the Vietnamese government it intends to scrap plans to build a new gas-fired power plant, proposing a renewable energy project as an alternative – citing soaring global gas prices since the war in Iran.

In the Philippines, the government is seeking to accelerate renewable energy projects, linking this to a desire to reduce exposure to imported fuels. “Every additional megawatt of renewable energy we bring online strengthens our ability to withstand global volatility,” Energy Secretary Sharon Garin was quoted as saying. “This is how we convert investment momentum into real energy security: more stable supply, greater resilience, and a system that better protects the Filipino people.”

And in New Zealand, government ministers are considering scrapping or delaying plans to build an LNG import terminal, amid similar concerns of skyrocketing gas prices. According to Prime Minister Chris Luxon, “if it’s not an attractive commercial case, we won’t be doing it.”

In the case of Pakistan, we can observe how years of solar power development have paid dividends by “acting like an insurance policy against the oil and LNG shocks,” with a new report revealing Pakistan has avoided over $12 billion in oil and gas imports between 2021 and February 2026 by accelerating its energy transition.

Across the region governments are reckoning with the volatility and fragility of the global oil and gas supply chain, and turning to local renewable energy projects as a safer and more resilient option for energy generation. The Australian government, too, has noted that harnessing more renewable energy at home will boost energy security and protect consumers from fossil fuel price shocks.

Japan’s pro-fossil agenda, supplied and enabled by Australian gas production, is looking increasingly risky by comparison.